• China’s massive pile of foreign exchange reserves declined for the first time in more than 10 years in Q4, 2011. Reserves were down $20.55 billion to $3.181 trillion after a slight increase in Q3. The last time reserves fell was the financial crisis of 1998. Capital flows in quarter most affected reserve levels as investors feared economic slowdown there. From the Wall Street Journal.
• Several large hedge funds that have built up sizable positions in Greek debt and look to play a game of chicken with the government over the “voluntary” haircut. The bond positions are supposedly large enough to hold up a deal. Och Ziff and York Capital are two funds who’ve indicated that they may hold out for a more favorable payout on the debt, hoping that Greece is up against it come March 20^th, when 14.5 billion euros in Greek bonds come due. From Reuters News.
• JP Morgan announced earnings of 90 cents per share, in line with analysts estimates. Revenue was light, though. Return on equity was below expectations, and the report outlined how difficult the capital and corporate markets were for the bank in the quarter. As anticipated, it will be a challenging reporting season for banks. From the Wall Street Journal.
• UK Factory output prices fell in December, unexpectedly. Prices fell .2% from November, and finished 2011 up 4.8%. Economists had anticipated a slight increase of .1% in the month. From Bloomberg News.