Disney in talks to buy game startup Playdom: report

SAN FRANCISCO (Reuters) – Walt Disney Co is in talks to acquire social gaming start-up Playdom, according to a pair of media reports.

Biden: Democrats must focus on successes before November

WASHINGTON (Reuters) – Vice President Joe Biden said on Friday “the hard lifting” is done for the year and now it is time for Democrats to campaign on their achievements ahead of November 2 congressional elections.

Judge tells former media mogul Black to stay in U.S.

CHICAGO (Reuters) – A U.S. judge on Friday ordered former media tycoon Conrad Black to stay in the continental United States while he awaits an appeals court ruling on whether his 2007 fraud conviction should be thrown out.

Michigan woman charged with murder in Facebook feud

DETROIT (Reuters) – A Pontiac, Michigan, woman was charged with murder on Friday after chasing down and ramming another car in a fight over a man that started on Facebook, police said.

Apple’s white iPhone 4 delayed in latest headache

NEW YORK (Reuters) – Customers will not be able to get their hands on Apple Inc’s white iPhone 4 until later this year, the company said on Friday, conceding that making the model has proven surprisingly difficult.

Bill Baker: When Will the AA Batteries Run Out?

Dagong International Credit Rating, a new Chinese credit rating agency, purports to adhere to “fundamental principles of truthfulness, timeliness, and consistency.” It warns that “over-reliance on financing income and debt roll-over will ultimately lead to a strong reaction of bond market, thus when the borrowing costs and difficulties increase, the credit risks will burst dramatically.”

Although it rates the United States AA and says “the advantages of a comprehensive institutional system will help them gain the rooms for adjusting finance and debt,” it culls out 18 countries for which it assigns ratings lower than those assigned by Moody’s, S&P, and Fitch (and the United States is among them). Thirteen of these are developed nations that have become, in Dagong’s words: “the biggest source of systemic risk.. (and a) double dip for the world economy… Once the fiscal risk in this sort of countries get out of control, they will have to face even more financing difficulty. Up to then the interest rate attached to the debt instruments will be running up rapidly, and the default risk in these countries will grow even larger; the fiscal fragility may badly threaten the successful recovery of their economic and financial conditions, and may even plague these countries in a relatively long run.”

These are interesting observations, because they indeed are truthful and timely as well as the product of consistently applied financial statistical analysis that provides Dagong a superior way to compare sovereign credit risk among nations. But it is also devoid of understanding of the systemic monetary flaws that led to the creation of excessive debt in recent decades.

This may explain why China may have not sold much U.S. debt, and why it may feel that it can safely invest in other nations’ credit rather than avoid systemic credit risk generally through allocating more than a trivial share of its currency reserves to gold. Laced through the analysis is recognition that some countries may apply Keynesian solutions because their sovereign and private credit capacity is ample, and their outlook for economic growth may be more intrinsically secure. In this way, China’s policy actions are rationalized by its policy makers (as well as by western pundits). So in addition to having consumed the monetary Kool-Aid of the west, China has embraced the fiscal orthodoxy as well. This point of view echoes Bernanke’s and Greenspan’s view that the global debt crisis was fostered by a “savings glut” in China.

Murray Rothbard warns of businessmen clustering together in error. It would be a shame if the Chinese, despite this trenchant analysis of how the world’s credit markets could unravel once again, steadfastly cast their lot with the Bernankes and Krugmans of the economics community. As for the United States, we have already crossed the Rubicon, hopelessly defending a fiat based reserve currency and admonishing all others in the G-20 to spend recklessly and prop up impaired credit instruments at any cost. The Chinese may be rating the U.S. “AA” for now, but if the process of instability of which Dagong hints takes over, we should expect the juice in this AA battery to run out, unable to be recharged by “a comprehensive institutional system (that) will help them gain the rooms for adjusting finance and debt.”

Read more: Debt, Financial Crisis, Ben Bernanke, Sovereign Debt Crisis, Ratings Agencies, China, Dagong, Business News

Judge tells Conrad Black to stay in U.S.

CHICAGO (Reuters) – A U.S. judge on Friday ordered former media tycoon Conrad Black to stay in the continental United States while he awaits an appeals court ruling on whether his 2007 fraud conviction should be thrown out.

Europe’s big banks pass stress tests

Most of Europe’s biggest banks passed stress tests aimed at shoring up confidence in the region’s economy, officials said Friday.