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BP, the UK energy group, has discovered a “giant” oilfield in the Gulf of Mexico that shows a new frontier opening up for US Crude Oil production. The Tiber field, in more than 1,200m of water about 250 miles south-east of Houston, is one of the biggest discoveries in recent years. It is thought to hold at least 3B bbls of Crude Oil, of which about 500M would be recoverable with today’s technology, and could be significantly larger. The field was found by the deepest oil well ever drilled, reaching more than 9.4km, almost six miles, below the sea bed. BP is pioneering the exploration of the Lower Tertiary or Paleogene area of the Gulf of Mexico, which lies deeper than the strata that provide most of the region’s known reserves. The Tiber discovery, following the Kaskida field found in 2006, which is also believed to hold 3B+ bbls of Crude Oil, is further evidence that there are large volumes yet to be found in the Gulf. BP believes there could be a further 20B barrels or more in the deep water, on top of the US’s proved reserves of about 30B barrels.

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3D technology looks set to hit the home consumer market next year, with Sony today announcing plans to sell 3D televisions globally by the end of 2010. Sony’s decision to throw its weight behind the technology will be an important boost for the 3D industry, which has so far focused mainly on cinemas. British Sky Broadcasting has said it would introduce a 3D satellite channel in the UK next year, but it had been unclear whether there would be equipment available to view it on. Speaking at the IFA technology trade show in Berlin, Sir Howard Stringer Sony chief executive, will announce plans not only to sell 3D Bravia television sets, but to make Sony’s Vaio laptop computers, PlayStation3 games consoles and Blu-ray disc players compatible with the technology. Read more

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In China the Government owns the Banks; the bankers do not own the Government. China’s stimulus plan is working better than in the US and the UK because the government is using the banks for public ends, rather than allowing the banks to use the government for private ends. In the USA, the banks are the most powerful lobby on Capitol Hill; they own the Government.

The USA is spending trillions of greenbacks to bail out its banking system, leaving its economy to languish, as China, now called a “miracle economy,” decoupled from the rest of the world, is maintaining a phenomenal 8% annual growth rate. That, by the way, is being questioned by lots of Pols, commentators, economists and other talking heads, as they ask how that growth is possible, when other countries relying heavily on exports have suffered major downturns and remain in the doldrums. Read more

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The US Federal Reserve bought US$7.541B of Treasuries in its second outright purchase of U.S. government debt in three days as part of the central bank’s efforts to lower consumer borrowing rates. The majority of the purchase was US$5.625B of the 1.375B note due March 15, 2012, that was issued this month. Seven of the 18 securities maturing from April 2011 through April 2012 listed for possible acquisition were bought, according to the Federal Reserve Bank of New York Web site. Central banks in the US, UK and Japan are buying government debt in the latest step to broaden efforts to unfreeze credit and end the recession after cutting benchmark interest rates close to zero.

The Fed bought US$7.5B in debt on March 25, the first purchase since the early 1960s by the central bank under a US$300B plan announced March 18. “The Fed’s monetization of government borrowing is in economic terms a hugely powerful liquidity tool,” said Lena Komileva, head of Group of Seven market economics in London at Tullett Prebon Plc, the world’s second-largest interdealer broker. “It also helps to address investor fears, by depressing government yields and private sector borrowing costs and signaling a firm commitment by the Fed to keep monetary liquidity flowing for a long time.”

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Since the World’s credit markets seized up on September 8, 2009 many corporations are either cutting costs, waiting for government bailout money, or preparing for bankruptcy, as banks are reluctant to lend to all but the most credit worthy and then at unconventionally high interest rates.

In the center of the storm lies the US, UK and EU financial industry where it all started.
The US Federal Deposit Insurance Corporation said last week that the nation’s banks and thrifts lost US$32.1B in the Q-4 Y 2008, the first quarterly deficit in 18 yrs, compared with the US$575MM profit in Q-4 Y 2007. The industry’s net income for Y 2008 plunged from US$16.1B to US$10.2 B for the period.

In the US eighteen federally insured banks have failed so far this year. Last year the number was 25, more than the total number of the previous five years, and up from only three in 2007.
Shares of Citigroup Inc., once the most powerful U.S. bank, have fallen below 1 dollar this month. Pummeled by the financial crisis, the group has lost more than 98 % of its value from its peak in October 2007, and is down more than 95 % from a year ago.

The American International Group (AIG), covered almost daily in www.stockpreacher.com’s Stock Talk, reported this month that it lost US$ 61.7B in Q-4 Y 2009, the largest corporate loss in history. AIG has benefited since from more than US$170B in federal rescue funds with more likely needed and to come.

HSBC Holdings PLC, the largest bank in Europe, early this month reported a 70% drop in its Y 2008 profit and said it would cut 6,100 jobs as it closes its consumer loan business in the United States. It also announced that it would cut its dividend and not pay bonuses to top executives.

In the US, the DJIA sank below 6,800 on March 3, its lowest close since May 1997, losing more than 50% from its highest level in October 2007. Since then the S&P 500 has staged a 19.8% rally off of its lows in the same frame.

On March 23 when the markets were surprised by the US government’s latest plan on clearing bad bank assets and a larger-than-expected rise in existing home sales, the three main indexes all surged more than 6.5% on the day.

Some Economists suggest that financial crisis has yet to bottom out, and the real economy continues to slip as the global economic situation deteriorates.

Therefore, stimulus spending, market confidence, financial regulation and free trade will be key issues at the G20 summit of the World’s leading developing and developed economies next week in London.

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For the first time since last March due to safe haven buying. Silver and platinum also rallied. Gold price for April delivery went up US$25.70oz or 2.6%, to settle at US$1,002.20 oz. hitting US$1,007.70 on the day. March Silver closed at US$14.49 oz +. 555 pennies. April platinum rose US$19.20 to 1,095.70 oz. Gold’s hedge appeal was strengthened as US stock market tanked.

The DJIA continued to decline sharply on Friday after closing Thursday at its lowest level since 2002. Markets in Germany, France, the U.K. and Japan also dropped, and investors flocked to precious metals as a safe haven amid tumbling stock markets. US$ vs. the Euro went down sharply on Friday after trading up for several trading days, erasing most of this week’s gains helping Gold to top US$1,000 oz.

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