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2011 predictions: interest rates around the world

Currency analysts pay obsessive attention to economic factors that indicate the direction of interest rates, because interest rates represent the price of a currency. Any price change has a direct impact on the currency’s value. That can mean huge gains or losses for currency traders, but it also has a big impact on what savers earn, borrowers pay, consumers shell out for imported goods, and global companies plan in terms of compensation and hiring. In 2010, the stress on various currencies became clear, causing many central banks to push interest rates to record lows. Here’s a look at how those forces could play out in 2011 in six major regions of the world:

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US stocks sink on Spain's bad debts

All three major US stock indexes sank Wednesday after a dismal report about bad loans on the books of Spanish banks. The Dow fell 82 points to close at 13032.
Stefan Karlsson
British inflation grows and grows. Is it temporary?

The British inflationary rate increased again in March, despite stagnant economic growth. Is it cause for worry?
Robert Reich
Gas prices: How rising fuel costs influence lawmakers

Gas prices are up, and it's already prompted Republicans to pass a bill to expand offshore drilling and and force the White House to issue a permit for the Keystone XL pipeline. But the hike in gas prices won't be as steep, or lasting, as some think.
Stock market: Futures slide on Greek indecision

Stock market looks to open lower as emergency talks fail to produce Greek rescue package. A disorderly Greek default could send shock waves through the stock market.
The Daily Reckoning
Creating more debt won't solve the economic crisis

World banks are trying to solve the financial crisis the same way they caused it — by creating more debt.
European debt crisis: Germany's fight against Keynes

The European debt crisis provides Germany the opportunity to preach its disciplined approach to monetary policy. Should it succeed in remaking Europe in its monetary image, Europe will prosper. Those who follow the Anglo-American model of Keynsian loose money must fall in line.
Germany's Merkel takes hard line on fixes for eurozone debt crisis

German Chancellor Merkel is pushing guarantees of greater fiscal discipline in exchange for a more assertive European Central Bank role in addressing the eurozone debt crisis.
Central banks ease liquidity. Did they avert meltdown?

Central banks in a surprise announcement Wednesday announce moves to ease strains in the global financial system. Central banks' moves should ease concerns over European banks but does not begin to solve long-term problems of European debt.
Latin America Monitor
With much fanfare, Venezuela's first batch of repatriated gold comes home

President Hugo Chávez oversaw the return of the first batch of Venezuela's gold from foreign banks.  Was it a publicity stunt?
Is Sunday's European debt crisis summit sunk before it even starts?

With German Chancellor Angela Merkel and French President Nicolas Sarkozy at odds over how to leverage bailout funds, hopes for a solution from Sunday's debt crisis summit are wavering.
Stocks rise on hopes for European banks

The Dow rose 131 points to close at 10939 as officials made moves to support Europe's struggling banks
Stock market gloom spreads. Blame Greece.

Stock market woes continue as Greece admits it won't meet deficit targets. European stocks fall, along with US stock market futures.
Treasury bond market intervention: Can Fed boost economy?

Treasury bond market could be subject to Federal Reserve 'twist' – selling short-term securities to buy long-term ones. The treasury bond market move could lower mortgage rates – or stoke inflation.
Markets rally after eurozone rescue mission by world's central banks

Five central banks take steps to funnel cash to eurozone commercial banks by year's end. Their aim? Avert a funding freeze – and perhaps another global banking crisis tied to bad debt.
Latin America Monitor
Midas touch? Hugo Chávez plans to use gold to end 'dictatorship' of US dollar

The Venezuelan president announced plans to nationalize his country's gold industry and move Venezuela's reserves out of Western banks and into the banks of more friendly nations.
Why Europe's debt crisis is still spreading [VIDEO]

European credibility seems to be the issue. Investors are increasingly edgy over whether EU policymakers can agree on how to ease the debt crisis.
Arab Spring made diamond prices sparkle: fund manager

Wealthy individuals in the Middle East shifted money and assets away from the region to safe havens elsewhere, sometimes in the form of diamonds
Stocks end sharply lower as oil prices tumble

After rising more than 75 points on Tuesday, the Dow dropped 130 points on Wednesday
The Daily Reckoning
Gold is up, but still not near peak

How long will monetary policy from the Fed and the Bank of England send the price of gold up?
Interest rates: Will the Fed signal a boost?

Interest rates were supposed to be kept low by the Federal Reserve's bond-buying program. Ben Bernanke will meet with the press on Wednesday, and investors will listen for clues about when the Fed might change its policy with interest rates.
Stefan Karlsson
Can interest rates affect how employers set wages?

Bank of England interest rate increases may cause some employers to act irrationally, by raising wages to help workers with higher mortgages. But most employers wouldn't.
Stocks close mixed amid lackluster trading

Dow rises 23 points to close at highest level in 34 months. But stocks on Nasdaq edge down.
Qaddafi's assets include luxury homes around world

Libyan dictator Muammar Qaddafi and his family own expensive real estate in London, New Jersey, and around the globe
Nikkei surges, other stock markets quiet

Japan's stock market index surges 4.4 percent as outlook for Japanese nuclear plant improves. Other stock markets in Asia, Europe little changed
Stocks close lower as technology slides

US technology stocks were the biggest losers as the Nasdaq lost 1.4 percent. The Dow stock index fell nearly 80 points and lost 0.7 percent.