Nokia Oyj reduced its earnings forecast for the second time this year and said it will cut as many as 10,000 more jobs and shut production and research sites in Chief Executive Officer Stephen Elop’s biggest overhaul.

The stock fell 18 percent to the lowest level since 1996, pushing Nokia’s market value below $10 billion. As part of the changes, sites in Finland, Germany and Canada will be closed and executives Niklas Savander, Mary McDowell and Jerri DeVard will leave, Espoo, Finland-based Nokia said today.

Elop, who took over as CEO in 2010, is reorganizing Nokia after market-share gains by Apple Inc.’s iPhone and Samsung Electronics Co. devices led to a slump in sales and four straight quarterly losses. The company risks going out of business in as little as two years unless it reduces expenses, said Alexander Peterc, an Exane BNP Paribas analyst in London.

Scott Plushau sent me this Bloomberg story about fifteen minutes after I filed Thursday's column...so it had to wait until today. The link is here.

JPMorgan Chase & Co's disastrous bets on corporate debt may have caused unexpected collateral damage: erratic behavior in a barometer that measures the financial health of blue-chip U.S. companies.

Those bets used Wall Street derivatives called credit default swaps. They are supposed to act like homeowners insurance, allowing bondholders, banks and hedge funds to buy protection against declines in the value of corporate debt, and ultimately protection against a default.

In this case, though, they became more like the pawns in a battle between JPMorgan and hedge funds on the other side of its bet. This struggle so dominated a corner of the market that it sent false negative signals about the credit quality of some major companies whose underlying finances were largely unchanged, market experts said.

This Reuters story was posted on their website just after midnight on Thursday...and is worth reading. I thank Andrew Holland for bringing it to our attention...and the link is here.

Americans are digging themselves out of mortgage debt.

Home equity in the first quarter rose to $6.7 trillion, the highest level since 2008, as homeowners taking advantage of record-low borrowing costs to refinance their loans brought cash to the table to pay down principal. The 7.3 percent gain was the biggest jump in more than 60 years, according to an analysis by Bloomberg of Federal Reserve data.

It’s the strongest sign yet that Americans’ home-loan debt burden is beginning to ease after the record borrowing that created, and ultimately popped, the housing bubble, leaving almost a quarter of homeowners with mortgages owing more than their properties were worth, said Richard DeKaser, deputy chief economist at Parthenon Group LLC in Boston. Half the mortgages refinanced in the fourth quarter reduced loan size, a record, according to Freddie Mac, the government-owned mortgage buyer.

“The willingness of homeowners to carry housing debt has been radically altered,” said DeKaser, former chairman of the American Bankers Association’s Economic Advisory Committee. “When the market was booming, a mortgage was used as a leveraging tool, and now it’s seen as a risk.”

This is another Bloomberg story from yesterday...and the second in a row from Scott. The link is here.

Canada's financial system remains highly vulnerable to a further deepening of the European debt crisis and to a correction in the housing market, which is showing some overvaluation, the Bank of Canada said on Thursday.

In its semi-annual Financial System Review, the bank said that while Canada's financial system is still robust, the overall risks to it are high, at the second-highest of the four risk levels the bank has delineated. That level is the same as in December, but the bank noted that in the interval conditions in Europe had improved early this year but then deteriorated again.

While households are not adding to their debt as fast as before, income growth is still not keeping up with debt accumulation. So the bank expects the household debt-to-income ratio to rise from the fourth quarter's 150.6 percent, a level that is already higher than in the United States and Britain.

And you thought that us Canadians...and their banking system...were more prudent??? Wrong on both counts, dear reader! This story was posted in the Vancouver Sun yesterday...and I thank Roy Stephens for sharing it with us. The link is here.

The European Central Bank said it can’t release files showing how Greece may have used derivatives to hide its borrowings because disclosure could still inflame the crisis threatening the future of the single currency.

Bloomberg News is suing the ECB to provide the documents under European Union freedom-of-information rules. The papers may help show the role EU authorities played in allowing Greece to mask its deficit for almost a decade before the nation’s troubled finances necessitated a 240 billion-euro ($301 billion) bailout and the biggest debt restructuring in history.

Disclosing the files when Bloomberg News first sought them in 2010 would have “fueled negative perceptions about Greece’s ability to honor its debt,” ECB lawyer Marta Lopez Torres said at a hearing of the European Union’s General Court in Luxembourg today. “It’s the same now with Spain” which “isn’t able to borrow money,” she said. “Markets are reacting in very volatile ways. It’s affecting the euro economy.”

This Bloomberg story from early yesterday morning is courtesy of Washington state reader S.A...and the link is here.

The Bank of England announced this afternoon that it would attempt to flood banks with cheap cash in order to stave off tensions in the interbank credit markets, according to Dow Jones.

This report followed rumors of coordinated central bank action to bolster liquidity across the world, however the BOE's plan appears to be much more U.K.-centric.

Speaking at a black tie dinner, BOE's Mervyn King and the Exchequer's George Osborne said they would initiate a two-pronged attempt to aid liquidity conditions.

More money created out of thin air. This story was posted over at the businessinsider.com website yesterday afternoon Eastern time...and I thank Roy Stephens for sending it. The link is here.

As if matters were not bad enough already in Euroland: Dutch retail sales collapsed by 11pc in April, even worse than the 9.7pc drop in Spain.

Charles Dumas from Lombard says the results of Europe’s "fiscal suicide pact" are becoming all too clear.

This is not contagion from Greece or any such nonsense. It is the result of the eurozone's destructive policy mix.

All three levers of EMU policy are set on contraction simultaneously.

This longish piece [for Ambrose] was posted in The Telegraph yesterday...and is worth skimming. It's another offering from Roy Stephens...and the link is here.

While we await the Moody's downgrade of the Spanish banking system, which we can only attribute to a lack of outsourced Indian talent, since three banks are now rated higher than the sovereign, Moody's decided to give a little present to our Dutch readers by downgrading 5 of their biggest banks: Rabobank Nederland, (2 notches to A2) for ING Bank N.V., (2 notches to A2) for ABN AMRO Bank N.V. (2 notches to A2), and for LeasePlan Corporation N.V. (2 notches to Baa2). The long-term debt and deposit ratings for SNS Bank N.V. were downgraded by one notch to Baa2. And yes, this means that the US banks (looking at your Margin Stanley) are likely next.

This zerohedge.com piece was posted on their website late Thursday evening...and I thank Roy Stephens for sending it. The link is here.

Spain's borrowing costs have surged to record highs and are perilously close to the point of no return, threatening a full-blown sovereign crisis unless the European Central Bank comes to the rescue.

"We're facing maximum tension. The situation is unsustainable over time," said the country's finance minister Luis de Guindos. Yields on 10-year Spanish bonds yields punched to almost 7pc, above levels that triggered ECB intervention to back stop Spain last November.

"The ECB needs to intervene very quickly or it is game over," said Nicholas Spiro from Spiro Asset Management. "There is a whiff of capitulation in the air."

The dramatic escalation comes just days after the eurozone agreed a €100bn rescue package for the Spanish state to recapitalise its crippled banks. "It is very worrying. Markets are behaving as if the eurozone is heading for break-up," said Jens Sondergaard from the Japanese bank Nomura.

This must read Ambrose Evans-Pritchard offering was posted on The Telegraph's website yesterday evening...and I thank Roy once again for bringing it to our attention. The link is here.

Central banks from major economies stand ready to take steps to stabilize financial markets by providing liquidity and preventing a credit squeeze if the outcome of Greek elections on Sunday causes tumultuous trading, G20 officials told Reuters.

A senior U.S. official cautioned that the Greek election will not provide "the definitive signal on what happens next" in the euro zone debt crisis.

But if severe market strains emerge after an unusual confluence of three elections this weekend - there are important polls in Egypt and France as well - central bankers are on standby to ensure enough cash is flowing through the financial system.

"The central banks are preparing for coordinated action to provide liquidity," said a senior G20 aide familiar with discussions among international financial diplomats. His statement was confirmed by several other G20 officials.

And even more money out of thin air. This Reuters story was filed from Washington yesterday afternoon...and I thank Roy once again for sharing it with us. It's worth reading...and the link is here.

Egypt's constitutional court has ruled that a third of the legislature was elected illegally. The ruling means that new elections for the entire parliament will have to be held.

Egypt’s supreme court ruled on Thursday to dissolve the Islamist-led parliament, plunging a troubled transition to democracy into turmoil just two days before an election to replace ousted leader Hosni Mubarak.

Islamist politicians who had gained most from Mubarak’s overthrow decried what they called a “coup” by an army-led establishment still stuffed with Mubarak-era officials. They said the street movement that spurred last year’s popular uprising would not let it pass.

Outside the constitutional court, protesters chanted “Down, down with military rule” and hurled stones at troops lined up in a security cordon.

This Reuters story from yesterday was picked up the france24.com Internet site...and I thank Roy Stephens once again for sending it. The link is here.

OPEC chief Abdullah El-Badri spoke out against looming new oil sanctions against Iran at the start of a two-day oil conference in Vienna on Wednesday, AFP reported.

“I don’t want to see any of my member countries under embargo,” El-Badri told oil representatives and ministers as the European Union is preparing to enforce an oil embargo against Iran from July 1st.

“I am really against this 100 percent,” he added.

Iran has come under unprecedented Western sanctions for its nuclear program. As a signatory to the non-proliferation regime Iran has right to develop nuclear technology for peaceful purposes.

This story, courtesy of Roy Stephens, was posted on the Tehran Times website on Wednesday afternoon...and the link is here.

Investors should buy assets in U.S. dollars and other currencies of strong developed nations because Japan may default within five years, said Takeshi Fujimaki, former adviser to billionaire investor George Soros.

“Japan is likely to default before Europe does, which could be in the next five years,” the president of Fujimaki Japan, an investment advising company in Tokyo, said in an interview yesterday. Japanese should hold foreign-currency products, such as those denominated in the greenback, Swiss franc, sterling, Australian and Canadian dollars, Fujimaki said.

“The yen and the JGB market are in a bubble,” Fujimaki said. “With the gigantic debt Japan has accumulated, a thin needle, or even a gentle breeze may pop this. Events in Europe can possibly trigger this to blow up.”

This Bloomberg story from yesterday evening was sent to me by West Virginia reader Elliot Simon...and the link is here.

As part of The Royal Mint’s growth plans into bullion, a new specification Britannia bullion 1oz gold (99.99% purity) and silver (99.9% purity) has been devised, creating a more refined product. We have also reviewed our packaging, moving from blisters to more durable tubes for easy storage and convenience. Longer-term developments include a precious metal vaulting facility for bullion customers to store coins purchased from us.

Whilst 2012 brings with it a new focus on the bullion market, a move into producing and supplying bullion coins is not a completely new phenomenon for The Royal Mint, as you would expect from a company with over 1,000 years of history in crafting coins. Designing and producing coins of the realm has been its business for many years, but the real jewel in its crown is the Sovereign – one of the most universally recognised coins to ever be struck.

Acknowledged globally and accepted as currency in more than 20 countries across the world, the Sovereign is the ‘king of coins’ whether it is bought for sentimental reasons or investment. For centuries, particularly during times of economic uncertainty or financial insecurity, people have turned to gold – and gold coins in particular – as a safe haven.

We'll see what happens with this, dear reader. If the usual VAT applies, this new venture by the Royal Mint will be dead before it produces its first bullion product. I thank Michael Riedel for sending me this royalmint.com story yesterday. It's worth the read...and the link is here.

The first is with Dan Norcini...and it's headlined "European Crisis & Bullion Banks Capping Gold". The second blog features Richard Yamarone, senior economist at Bloomberg Brief. It's entitled "Fed Impotent, Depression & China's Crash Landing".

This story was posted over at the Zero Hedge website yesterday...and I thank Casey Research's own Alex Daley for sending it. It's an interesting read...and the link is here.

The protracted correction in gold and precious metals stocks that began in September 2011 appears to have ended. Our conclusion is based on historically reliable gauges of sentiment, valuation and technical factors. (We will publish the specific readings on these gauges with our second quarter investment letter on June 30.) This basing, in our view, should establish a solid platform to launch both the metals and the related mining shares to new highs within the next year. The investment sentiment for gold and especially mining shares is demoralized and confused. This setting, in our opinion, equates to an outstanding, low risk entry point to both the metals and the shares in anticipation of future monetary debasement.

Whatever monetary regime succeeds the current dollar reserve system will involve a significant and permanent re-pricing of gold. Gold will not fall back to lower price levels that prevailed until after the crisis that is at hand has run its course. The nature of earnings from precious metals miners will therefore be seen by the market as sustainable at higher levels and will not be seen as fleeting and subject to major declines based on the gold price. As such, valuations will be more generous than the current miserly levels. The case for precious metals equities therefore rests both on their optionality to higher gold prices and the potential for a significant re-rating.

It was John Hathaway's August 1999 essay "The Golden Pyramid" that got me started down the long gold and silver road that I find myself on today...and it seems like forever ago. Here's his latest commentary...and it's posted on the tocqueville.com Internet site. It is, of course, an absolute must read..and the link is here.

[And if you haven't read his "Golden Pyramid" essay linked above, this would be a good time to do that. But I suggest you top up your coffee first, as it's a bit of a read. Ed]