FTM Morning News Update – Thursday – Feb. 3, 2011

by Jerry Robinson

Good morning friends! In the news this morning: Egypt, Food Prices, the Euro, and more…

Egypt… Egypt continues to descend into chaos this morning. Violence is escalating as firebombs and gunfire erupt across the country… The U.S. and other Western leaders are calling for an immediate transfer of power to a new transitional government made up of opposition parties to prepare for the upcoming September elections. But ElBaradei’s role is increasingly in doubt…

The United Nations began efforts to evacuate its staff from the country this morning… Meanwhile, the Egyptian military has begun rounding up journalists in an apparent effort to intimidate international news agencies in their coverage… And fears over a closure of the Suez Canal continue to mount…

Israel continues to express major concerns over the U.S. stance on Egypt. This week, the leading opposition movement in Egypt, which appears set to take control of a new government, is calling for an end to the peace accords with Israel. The Islamist zealots are waiting in the wings and Israel knows it…

However, Egypt is just one of a growing list of countries in the Middle East and North Africa which have been engulfed in protests against poverty, corruption and authoritarian regimes. Today is the “Day of Rage” in Yemen as at least 20,000 anti-government protesters take to the street in an effort to oust that country’s president.

Wicked Weather… Australia is being ravaged by, what is being called, its worst cyclone in history — the category 5 cyclone Yasi...

Much of the U.S. is in shock after the Blizzard of 2011… The third biggest blizzard in Chicago’s history… Now, a growing list of power outages… Even proud Texas is borrowing electricity from Mexico to keep its lights on… Interestingly, the this year’s Super Bowl Stadium in Dallas remained exempt from the blackouts…

U.S. air travel remains in turmoil with over 6,000 flights canceled today…

Euro… As I have been telling you, the U.S. media has been far too fixated upon Europe’s debt crisis. While the crisis is real, the debt crisis facing the U.S. is much more pressing. However, highlighting Europe’s “crisis” directly impacts the Euro currency which benefits a sick and withering U.S. Dollar. I have been saying for months that I do not expect the Euro to collapse anytime soon. It is nothing but a Washington pipe dream… So far I have been right as the Euro has now risen to a 2 1/2 month high against the Dollar. Tomorrow, Europeans will meet to outline a sustainable strategy for dealing with their sovereign debt crisis. (Take note America… they are attempting to work together to create a strategy for dealing with their debt problems.) This morning, the ECB held interest rates steady at record lows of 1% despite simmering inflation fears.

Rich and Poor… A new report shows that even after one and half years into the economic “recovery”, 43.6 million Americans are relying on food stamps to buy basic food staples… That’s more than 14% of the population. Meanwhile, only two years after teetering on the edge of a global depression, Wall Street firms are earning record pay… Total compensation and benefits at 25 publicly traded Wall Street firms increased nearly six percent in 2010 to an all-time high of $135 billion…

Global Food Crisis… According to a new UN report, world food prices reached their highest level since records began in 1990. Millions of lives are at stake if prices refuse to abate…

The Donald… You know its bad when even Donald Trump is warning of an economic collapse…

Wikileaks… A newly released cable details a military standoff between the U.S. and China over space missiles… Both shot down their own satellites using sophisticated missiles in separate show of strength…

Finally… After reading that oysters are disappearing fast and 85 percent of their reefs have been lost due to disease and over-harvesting, I was reminded of my most recent interview with Matt Stein. You can listen to the very interesting hour long interview here…

Why So Serious?… Here’s a sampling from some of the late shows this week…

“Protesters in Egypt are demanding that President Murabak step down by Friday. Murabak says he’ll leave in 5 years and then hand the job off to Conan O’Brien. Even Brett Favre was like, “Come on man, retire already, you’re embarrassing yourself.” –Jimmy Kimmel

“Egypt has responded to hundreds of thousands of protesters by shutting down the internet. Listen, if you want people to stay home and do nothing, turn the internet back on.” –Conan O’Brien

“Huge riots continue in Egypt. Experts say one of the problems over there is there is a huge difference in wealth between the extremely rich and the vast majority of the people who have nothing. Thank God that could never happen in this country, huh?” –Jay Leno

“The Midwest got over a foot of snow; it rained ice pellets in Dallas; it’s wet and freezing in New York. I was complaining about it all day to my friend in Egypt.” -Jimmy Fallon

Jerry Robinson is an economist, published author, columnist, international conference speaker, and the editor of the financial website, FTMDaily.com. In addition, Robinson hosts a weekly radio program entitled Follow the Money Weekly, an hour long radio show dedicated to deciphering the week’s economic news.

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