FOREX-Euro steady, but vulnerable to Italian and Greek woes - Reuters
* Euro runs into selling by investors at uptick
* Euro zone bond yields to offer direction to currencies
* USD/JPY ensconced between offers and bids from real money players
By Anirban Nag
LONDON, June 13 (Reuters) - The euro was steady on Wednesday, w ith bearish investors selling at higher levels as concerns mounted that debt contagion would ensnare Italy and as general unease prevailed about the euro zone before crucial Greek elections.
Even yields on normally safe-haven German bunds climbed in a clear signal that investors are increasingly gloomy about the euro zone. Some cited this as evidence that the rising cost of shoring up the euro zone was taking a toll on Germany's creditworthiness.
Germany is Europe's largest economy and paymaster and major currencies are likely to take cue from euro zone bond yields, traders said. If Italian and Spanish bond yields continued to edge up towards unsustainable levels of around 7 percent, the euro could come under more pressure in the near term.
On the other hand, if bond yields eased, it could provide some temporary relief to the euro.
The euro was flat on the day at $1.2522, well above its near 2-year low hit on June 1 at $1.2288 but below its three-week high reached on Monday at $1.2672.
It rose past reported offers from sovereign investors around $1.2520 with stop-losses triggered on its move to a session high of $1.25389. Near term resistance is eyed at the 21-day moving average around $1.2551.
"There is a risk that the Spanish problems could spread to Italy and investors are mindful of that," said Jeremy Stretch, head of currency strategy at CIBC World Markets.
"The risks are asymmetrical against the euro and while only a bout of short covering can lift the euro, we would suggest investors fade into that rally."
Investors and speculators have added to significantly high bearish bets against the common currency in the past few months as the euro zone crisis swept across much of Europe. The euro has fallen more than 7 percent from the peak of 2012 hit in February and few see the situation improving any time soon wit h no credible policy response in sight.
Analysts say unless euro zone policymakers take steps towards a more cohesive fiscal union and puts its banking system in order, bearish sentiment towards the euro will stay entrenched.
IMPLIED VOLATILITY JUMPS
Concerns over the outcome of Greek elections at the weekend, where parties opposing and supporting harsh austerity measures imposed by the country's international lenders are neck and neck in public opinion polls, led some investors to remain on the sidelines.
The options market was positioning for the elections with 1-week euro/dollar implied volatility trading at the highest level since November at 15.9 percent as quoted by ICAP , up from 10.5 percent last Friday.
"One week implied volatility is hitting extreme levels. Many players are buying downside puts to protect themselves in case anti-bailout parties win the vote," said a trader for a Japanese bank. He added if that happened, the euro could quickly tumble below $1.2288, the 23-month low struck on June 1.
Against the safe-haven yen the euro was up 0.2 percent at 99.70 yen. Traders said Japanese exporters were likely to cap any gains in the currency around 100 yen.
They also cited uncertainty about the terms of the 100 billion euro Spanish rescue amid fears that private bondholders could be pushed down the repayment chain below official lenders, risking losses in any debt write-down, similar to Greece.
Meanwhile, Italy faces a test on Thursday, when it plans to offer up to 4.5 billion euros of fixed-rate bonds. The sale comes as 10-year Italian bond yields have surged past 6 percent, undermining confidence in the ability euro zone's third-largest economy to undertake austerity reforms.
The dollar was flat against the yen at 79.54 yen, hovering below this week's high at 79.92 yen. Traders reported offers around 79.70 yen from Japanese exporters and bids emerging around 79.20. Chart analysts were eyeing the 100-day moving average at 80.23 as the next resistance level.
Money wasn't key to winning in primaries - Morning Sentinel
Money wasn't key to winning in primaries
By John Richardson jrichardson@mainetoday.com
State House Bureau
PORTLAND -- Tuesday's primary elections proved again that money doesn't necessarily equal success in Maine politics.
But spending at the right moment appeared to help at least one candidate.
An analysis of money raised by candidates and how many votes they got shows that state Sen. Cynthia Dill of Cape Elizabeth, who won the Democratic nomination for U.S. Senate, raised the least money per vote, $1.91, of any major party candidate.
Dill ran one of the leanest campaigns and got the most votes -- more than 22,000.
Her closest competitor, former Secretary of State Matthew Dunlap of Old Town, raised $5.56 per vote. State Rep. Jon Hinck of Portland, who finished a distant third, raised $18.37 per vote.
"It's interesting to see how well Dill did with how little money she had," said Jim Melcher, a political scientist at the University of Maine at Farmington.
What mattered more than money was the fact that Dill was seen as a fierce partisan, so she appealed to the core primary voters, Melcher said. "I don't think you've got to have a lot of money to win a primary. I think you need people with passion behind you, and I think Dill's experience showed that."
The winner of the Republican primary, Secretary of State Charlie Summers of Scarborough, wasn't among the top money raisers in his primary. However, a cash infusion right before the election did allow Summers to air more television commercials.
Melcher and other political experts said the low turnout for Tuesday's primary also limited the impact of money.
The official voter turnout won't be calculated until the end of the week, according to the Secretary of State's Office. But with 95 percent of precincts reporting as of Wednesday, unofficial results showed that just 13.1 percent of Maine's registered voters -- 120,076 -- cast ballots in the Republican and Democratic U.S. Senate primaries.
That number doesn't include independent voters who cast ballots on local referendum questions but could not vote in the party primaries.
A typical June primary draws about 20 percent of Maine voters.
While Dill got a lot of bang for her campaign buck, she didn't have to keep up with any big-money rivals.
Mark Brewer, a political scientist at the University of Maine, said money was less of a factor for the Democrats because none of the four bought pricey TV spots. Hinck raised the most money -- more than twice Dill's total -- but "it clearly didn't help him," Brewer said.
Four of the six Republican candidates put commercials on television, including Summers. The Republican winner raised far more than Dill, but he wasn't in the top tier of fundraisers in the GOP race.
Summers got 29 percent of the vote, and raised the second-least per vote, $7.72, among the GOP candidates.
State Treasurer Bruce Poliquin of Georgetown, the Republican runner-up, raised $17.45 per vote. Third-place finisher Rick Bennett, a former state Senate president from Oxford, raised $16.71.
Scott D'Amboise, the businessman from Lisbon Falls who got 11 percent of the vote, raised a whopping $92.27 per vote, although he was in the race considerably longer than any other candidate because he was challenging Sen. Olympia Snowe before she announced her retirement in February.
"D'Amboise raised the most and nobody knows what he did with his money, so he clearly did the worst with his money," Brewer said Wednesday. "But I think you could say that it mattered for Summers because he needed to get on TV and that probably helped him fend off Poliquin. But this race was more about name recognition than money."
Summers' success makes it apparent that money spent at the right time does help. Campaign finance reports show that Summers donated $50,000 to his campaign in the two weeks before the primary. His campaign spokeswoman, Jen Webber, said that money went directly to TV ads in the finals days of the race.
Poliquin came up short for the second time after outspending opponents. He finished sixth in the seven-way GOP gubernatorial primary in 2010 despite spending the second-most money, much of it his own.
This time, Poliquin self-financed about half of his campaign and used that money largely on TV and other advertising.
Brewer said money played even less of a role in the Republican primaries in Maine's two congressional districts.
And in Saco, state Rep. Linda Valentino easily defeated state Rep. Donald Pilon in the Democratic state Senate primary, even though a pro-racino political action committee spent $9,513 to support Pilon.
Money could play a larger role in November's U.S. Senate election, a race between Dill, Summers and independent Angus King, who was Maine's governor from 1995 to 2003.
Three lesser-known independent candidates -- Steve Woods, Danny Dalton and Andrew Ian Dodge -- also have qualified for the ballot.
Brewer said the big question is whether King's presence and popularity will scare off big Republican and Democratic donors.
"The party money will be what to watch. I don't think we'll see any national party money," he said. "Maybe if Summers can convince them that with some help, he can take down King, someone might cut him some checks, but they won't want to throw that money away."
Nationally, the Democratic Party has not committed to investing in Dill's campaign. A campaign spokesman said it will be decided in "a careful set of meetings" between Dill and national party leaders.
Melcher said he thinks that plenty of money will be spent in Maine, in general election campaigns and on referendum questions, in part because "Maine is such a cheap media buy."
On the other hand, he said, "I think to some extent people here are a little more immune to that kind of flash and that kind of advertising."
Healthcare, money in politics, unions, and Obama's unpopular positions lose the youth vote - Washington Times
WASHINGTON, 14 June, 2012 — President Obama has not made a huge blunder in a few days, so the news has been relatively slow.
Nevertheless, several themes have emerged, clarifying themselves as of late.
In no particular order:
1. Mitt Romney and Healthcare
It seems that Mitt Romney is in the best position of all to argue the healthcare issue, no matter how the Supreme Court rules later this month on Obamacare. The conventional wisdom on the right is that the Affordable Care Act will be overturned, a wisdom that is bolstered by worry on the left.
If the Supremes declare it unconstitutional in whole or in part, Romney is in a comfortable positions, since he can fairly say that such was his argument all along. The Republican nominee-to-be will certainly make hay out of it, claiming that the law represented an overreach of the federal government, and that he would never test the limits of federal power the way Obama has.
You can believe it or not, but that's what he'll say, which is consistent with what he has been saying for the past three years.
Perhaps the Court will let the law stand, in which case Romney can make the argument that he, among all prominent politicians, is in the best position to craft a replacement to the overwhelmingly unpopular law, since he enacted a state version of a similar variety.
Among independents, Romney will come off as pragmatic, since he was able to develop a bipartisan solution in his own, liberal state.
2. Money and Political Wins
Money signals enthusiasm in elections. Democrats are convulsing about the amount of money spent on Gov. Scott Walker's behalf, trying desperately to cast their looming defeats as natural features of a newly sinister Citizens United landscape.
Hogwash.
The concept of money operating as political speech has a long tradition in American politics, and the Roberts Court rightly restored the freedom to contribute dollars to all associations, including corporations and unions.
That Wisconsin Democrats were unable to raise as much as Walker's allies says a lot about why they are complaining, and even more about their viability. Money flows to winners, not as an access point to influence, but as a way to show support. "Put your money where your mouth is" means exactly that. Democrats didn't.
In that light, monetary contributions are an indicator of enthusiasm for a particular candidate or cause.
Recall that candidate Obama rejected public financing four years ago, eventually raking in $750 million as compared to the $84 million that his rival took in through the public system. In justifying his decision to break an earlier promise, Obama declared "independence from a broken system," and pledged to "run the type of campaign that reflects the grassroots values that have already changed our politics and brought us this far." In other words, then-Senator Obama preferred to allow individuals to speak through their small-dollar contributions.
He was right then. But he's wrong now about large-dollar contributors (though he has no problem taking in big money from wealthy Hollywood donors). If a wealthy individual is particularly enthusiastic about a candidate, she should be free to express that enthusiasm with a larger contribution. Again, put your money where your mouth is. Some people have big mouths, others have big wallets.
Perhaps Democrats are just a little bitter that their candidates, including the president, aren't bringing in the kind of money that they did in 2008.
3. The Decline of the Unions and Other Unpopular Positions
Unions aren't that popular. In fact, most of what Obama supports isn't popular. If Scott Walker's re-win is any indication (and it is), then public approval of unions is on the decline, and particularly of unions of government workers.
It is fine that the president supports something that is unsupported by a majority of Americans. President Bush, for example, stood by the virtue of the Iraq War until the bitter end, even when public opinion had gone underwater.
But President Obama is on the losing side of many big issues: his healthcare bill, oil drilling, fracking, the Keystone pipeline, taxes, the deficit, another stimulus, and gay marriage, to name a few.
Again, perhaps he has taken principled stands on all these issues, though it seems like a remarkably misfortunate coincidence that he is, on nearly every major issue, out of sync with the electorate that he hopes will grant him another term in a few months.
4. Obama loses the Youth Vote
Young people won't deliver for Obama in 2012. First, those who showed up for him last time are four years older now. With age comes different voting patterns, at least on the margins. Others will have wised up, or maybe they have become disengaged or disenchanted.
More importantly, their replacements (the new young) have come of age in a terrible economic time, and are a lot less likely than their forebears to be enraptured by the thought of an Obama presidency.
5. Campaigns at Odds
It has become political dogma that the 2012 election will be a nail biter, coming down to a few states. How does anybody know? Bill Kristol asked just such a question several weeks ago. It might not be close. Romney might open up a healthy lead and run away with it.
Sean Trende of Real Clear Politics has made the point that if Romney can build a significant, but not implausible, lead over Obama in national polls, then states like Pennsylvania, Michigan, Colorado, and Wisconsin will go into play. Under that scenario, Romney could accumulate up to 320 electoral votes or more, making it a rout.
One thing is certain: if Obama wins, it will be close. Nobody is suggesting that the president can come remotely close to replicating his 2008 victory map. For Romney, however, it is wide open.
Learn more about the author at Rich-Stowell.com
Rich is a teacher and a soldier. In addition to writing the "Rich Like Me" political column at the Washington Times Communities, he is the author of Nine Weeks: A Teacher’s Education in Army Basic Training; Tunnel Club; and Not Another Boring Textbook: A High School Students’ Guide to their Inner Conservative, which you can follow on Facebook.
This article is the copyrighted property of the writer and Communities @ WashingtonTimes.com. Written permission must be obtained before reprint in online or print media. REPRINTING TWTC CONTENT WITHOUT PERMISSION AND/OR PAYMENT IS THEFT AND PUNISHABLE BY LAW.
FOREX-Euro advances for 2nd day, but gains seen limited - Reuters
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