Thursday, 31 March 2011

Wulff hält Bankern wegen Finanzkrise Standpauke

REUTERS DEUTSCHLAND: Berlin - Bundespräsident Christian Wulff hat den Banken die Leviten gelesen.

Die Ursachen der Finanzkrise seien nicht beseitigt, warnte das Staatsoberhaupt am Donnerstag auf dem Deutschen Bankentag in Berlin: "Ohne einen grundlegenden Kurswechsel drohen neue Finanzkrisen." Noch eine Rettungsaktion mit Steuermilliarden könne sich der Staat nicht leisten. Auch Kanzlerin Angela Merkel warnte, die Institute könnten sich bei künftigen Finanzkrisen nicht auf neue Staatshilfen verlassen. Die Branche räumte Fehler ein, warnte aber vor einer Überlastung ihrer Ertragskraft durch die Regulierungsoffensiven der Politik.

"Haben wir aus den Fehlern wirklich gelernt?", fragte Wulff die versammelte deutsche Hochfinanz: "Mein Fazit lautet: Nein - weder haben wir die Ursachen der Krise beseitigt, noch können wir heute sagen: Gefahr erkannt - Gefahr gebannt." Er habe Zweifel, dass der mit der Pleite der US-Investmentbank Lehman Brothers im Herbst 2008 ausgelöste globale Schock dauerhaft nachwirke. "Manchmal scheint mir, dass dank der staatlichen Krisenmaßnahmen der Schreck bei vielen verflogen ist und die alten Verhaltensweisen zurückgekehrt sind." Die Krise habe die Politik an die Grenze ihrer Möglichkeiten gebracht. Eine so große, konzertierte Rettungsaktion sei nicht wiederholbar.

Bis Ende des vergangenen Jahres hatte der Staat zur Stützung wackelnder Banken Garantien von bis zu 400 Milliarden Euro und bis zu 80 Milliarden Euro an Eigenkapitalhilfen bereitgestellt. Überall in Europa mussten sich die Regierungen schwer verschulden, um ihre Geldinstitute zu sichern. Das ist eine der Hauptursachen für die grassierende Schuldenkrise in der Euro-Zone. » © Reuters | Donnerstag, 31. März 2011

Tuesday, 29 March 2011

Portugal and Greece Downgraded on Debt Worries

BBC: Ratings agency Standard & Poor's has downgraded struggling Greece and Portugal on further debt worries.

S&P says investors in their bonds could lose out under the terms of a new eurozone bail-out package.

The move pushed up the countries' borrowing costs as lenders demanded a higher rate of return for buying government bonds.

The downgrades left Portugal one notch above junk rating and Greece's creditworthiness below that of Egypt. » | Tuesday, March 29, 2011
Inside Story: UK March for an Alternative

In an event dubbed the march for the alternative, hundreds of thousands gathered in London - protesting against the coalition's planned spending cuts - the largest cut-backs since the Great Depression. Organised by the Trade Union Congress, the protests remained largely peaceful. However events were overshadowed by violence that later erupted. But as Europe is still struggling to avoid another financial crisis, would such measures have any impact? And what are the social and political implications? Inside Story, with presenter Ghida Fakhry, discusses with: Jeremy Batstone-Carr, head of research at Charles Stanley stockbrokers; Max Keiser, financial analyst and renowned banking critic [Wiki] and Tom Clougherty, executive director of the Adam Smith Institute, a U.K.-based think tank dedicated to free market policies.

Saudis and Oil Key to Global Economy

THE SYDNEY MORNING HERALD: The fate of the world's economy and financial markets lies with Saudi Arabia's political stability and the price of oil over the next three months.

That's according to independent economist David Hale, who says an escalation of friction between oil producers Saudi Arabia and Bahrain could tip the world back into recession.

Mr Hale's opinion is backed by Magellan Financial Group's chief executive Hamish Douglass, who says a major conflict involving major oil producers could have the oil price skyrocket by $US200 a barrel.

Saudi Arabia's intervention in Bahrain two weeks ago to quell a civil uprising polarised, rather than stabilised, the situation that had since quietened down, said Mr Hale, who is global economic adviser to the Commonwealth Bank of Australia.

"I think it was probably too pre-emptive and probably destructive," he told AAP in an interview in Melbourne.

"I think the critical issue of a tipping point is Saudi Arabia and political stability.

"If that's jeopardised, that could send the oil price up (by) $US50 a barrel, $US100 a barrel. That would tip us into a new global recession." » | Alison Bell | AAP | Tuesday, March 29, 2011

Monday, 28 March 2011

EU to Ban Cars from Cities by 2050

THE DAILY TELEGRAPH: Cars will be banned from London and all other cities across Europe under a draconian EU masterplan to cut CO2 emissions by 60 per cent over the next 40 years.

The European Commission on Monday unveiled a "single European transport area" aimed at enforcing "a profound shift in transport patterns for passengers" by 2050.

The plan also envisages an end to cheap holiday flights from Britain to southern Europe with a target that over 50 per cent of all journeys above 186 miles should be by rail.

Top of the EU's list to cut climate change emissions is a target of "zero" for the number of petrol and diesel-driven cars and lorries in the EU's future cities.

Siim Kallas, the EU transport commission, insisted that Brussels directives and new taxation of fuel would be used to force people out of their cars and onto "alternative" means of transport.

"That means no more conventionally fuelled cars in our city centres," he said. "Action will follow, legislation, real action to change behaviour." » | Bruno Waterfield, Brussels | Monday, March 28, 2011
US Oil Boom: Boon or Bane?

North Dakota is on track to become the second biggest oil producing state in the US. But with many of the oil fields located on a native American reservation, tribal members are wondering how the sudden boom will affect their way of life. 
Al Jazeera's Cath Turner has more

Sunday, 27 March 2011

Russian Communists Looking to Overturn Privatization

RUSSIA TODAY: Russia’s Communist Party faction has submitted a bill on nationalization to the lower house of parliament.

The legislation concerns the nationalization of companies that were privatized during the 1990s. Communists have always condemned the process of giving the state assets to individuals, many of whom turned into so-called oligarchs.

Observers say the Communists are trying to use their populist “trump card” now as they have started preparations for parliamentary elections scheduled for December. At the same time, the government is now launching another large-scale privatization campaign.

The Communist Party of the Russian Federation (CPRF) proposes that the state returns businesses that were “unfairly” privatized. But they support compensation of expenses to current owners after “the assessment of assets at the moment of privatization.” » | Friday, March 25, 2011
US Economy in Deep Hole

Capitalism at Fault for Global Crisis

RUSSIA TODAY: Is capitalism to blame for the rise in unrest and the fall of global markets? One scholar argued yes, saying it is merely how capitalism works. Ha-Joon Chang, a senior research associate at the Center for Economic and Policy Research and author of “23 Things They Don’t Tell You About Capitalism” argued the assumptions behind the dogma and hype of capitalism and the free market spun by the neoliberal economists since the era of Reagan are completely false. » | Friday, March 25, 2011

Saturday, 26 March 2011

How to Tell a Zippo From a Rippo

The manufacturer of Zippo lighters offers a lifetime repair guarantee, but the company won't fix fakes. Here are some ways to tell the real thing from the counterfeits. WSJ's Barry Newman reports

Friday, 25 March 2011

Inside Story - The Impact of Disaster on Japan's Economy

It's two weeks since the magnitude 9.0 earthquake and 10-metre tsunami struck the northeast coast of Japan. Hundreds of thousands of people are still homeless, more than half a million households do not have water, and workers are still battling to gain control of the Fukushima nuclear power plant.
 Fears of contaminated food are spreading overseas as officials report traces of radiation in milk products, seawater and 11 kinds of locally-grown vegetables. 
How will Japan recover from the disaster? Will it be able to regain the world's confidence, and how long will it take?

Facing Housing Crisis, Saudi Arabia Sets Up Ministry

REUTERS AFRICA: RIYADH - Saudi Arabia has set up a ministry for housing, the kingdom's state news agency said on Friday, as the world's largest oil exporter seeks to address huge demand for new homes.

The Gulf nation is facing a massive housing problem due to rapid population growth and an inflow of expatriate workers coming to the kingdom. » | Reporting by Jason Benham; Editing by Elizabeth Fullerton | Friday, March 25, 2011

Thursday, 24 March 2011

Bank of England Must Raise Interest Rates Before Its [sic] Too Late, Warns Chief Economist Spencer Dale

THE DAILY TELEGRAPH: The Bank of England is at risk of gradually losing public confidence due to persistently above-target inflation, posing an upward risk to future prices, the central bank's chief economist, Spencer Dale said on Thursday.

Mr Dale – who voted for higher interest rates this month and last – broadly defended the BoE's past policy decisions in a speech to asset managers, but said it was now time to tighten what he described as "extraordinarily loose" monetary policy.

Unlike some of his colleagues on the nine-strong Monetary Policy Committee, Mr Dale said he was wary about the apparent stability of public medium- and long-term inflation expectations in surveys.

"I'm cautious about how much comfort we can take from the relative stability in these measures," he said.

"Although some economists may like to think otherwise, most companies and households have far better things to do than spend time formulating detailed expectations of the rate of inflation likely to prevail in five or 10 years time."

He said the bank's credibility could dissipate slowly over time, posing a major upside risk to the BoE's current forecasts of inflation falling back to target.

Specifically, the risk was that the public would think the BoE was prepared to tolerate very lengthy periods of above target inflation, rather than take rapid action to bring prices back to target, Mr Dale said. Read on and comment » | Thursday, March 24, 2011
Portugal in Turmoil

MAR 23 - Portugal's Prime Minister steps down after austerity vote fails. Conway Gittens reports

Singapore Bans Japanese Food

Mar 24 - Singapore becomes the latest country to ban food imports from certain regions in Japan. Arnold Gay reports

Bahrain Unrest Brings Economy to Standstill

REUTERS: In the marble lobby of one of Bahrain's most prestigious hotels, smartly-uniformed staff with polite smiles outnumber the few guests. The Saudi cars normally parked outside are conspicuous by their absence.

Once a relaxed and business-friendly island on the edge of the conservative kingdom of Saudi Arabia, Bahrain's economy has been brought to a standstill by unrest that has sucked in neighbouring armies and sent investors and expatriates running.

Gulf Hotel has closed some of its floors and cut back restaurant hours while some of its staff are on voluntary leave.

"Our occupancy has dropped from the high 90s to the low 25 and 30s, so our business has been badly effected in all areas," Gulf Hotel CEO Aqeel Raees told Reuters in an interview.

"Everybody in Bahrain has been affected ... For the business to recover[, it] will take time, because all planned activities, conferences, exhibitions, meetings have been postponed or cancelled."

Bahrain has been gripped by unrest since protesters took to the street last month, setting up camp at Pearl roundabout. Last week, they cut off the road to the financial district, prompting the government to call in Gulf Arab troops, impose martial law and launch a crackdown that drove protesters off the streets.

Bahrain's four main shopping malls were cut off from customers for five days and shops around the city were shut as fear spread. They have begun to reopen, but business is slow.

"The unrest has not just affected us but the whole economy," said Ahmed Sanad, head of the hotel and restaurant association.

"Our occupancy is down from near 100 percent to 30 percent. We can't do anything... People want one thing, the government wants another and stuck in the middle and losing."

"If everyone pulls in a different direction we will all suffer. We must all offer concessions or we are all losers." » | Lin Noueihed | MANAMA | Thursday, March 24, 2011
Portugal in Crisis after Prime Minister Resigns over Austerity Measures

THE GUARDIAN: • EU bailout closer after José Sócrates loses crucial vote • Political limbo will put pressure on Portuguese bonds

Portuguese prime minister José Sócrates has said he has submitted his resignation to the president after parliament rejected his minority Socialist government's latest austerity measures.

The loss of the vote "has taken away from the government all conditions to govern," Sócrates said. It brings the country closer to needing a bailout.

Sócrates is said he tendered his resignation to President Aníbal Cavaco Silva tonight, leaving the country in a political limbo that would place further pressure on Portugal's record-level bond yields.

Sócrates had said before the vote that he would resign if the measures to cut spending and increase taxes – designed to see off a bailout similar to those taken by Greece and Ireland – were rejected.

The measures had aroused the fury of trade unions, and railway engineers walked off the job in the morning, causing widespread travel disruption. » | Giles Tremlett in Madrid | Wednesday, March 23, 2011

THE GUARDIAN: Portugal bailout 'could cost UK £3bn': Bailout request seen as 'inevitable' following prime minister's resignation in wake of failure to push through austerity measures » | Graeme Wearden | Thursday, March 24, 2011

Wednesday, 23 March 2011

Japan Politics Worries Investors

Mar. 23 - Japan's Prime Minister and his opposition rival need to hit the reset button after years of mistrust to tackle an extensive reconstruction. Kei Okamura reports

U.S. Housing Slump Deepens

Mar 23 - Summary of business headlines: New home sales plunge to record low in the U.S.; Japan quake could be costliest natural disaster; Goldman Sachs CEO takes witness stand at insider trading trial. Conway G. Gittens reports

Portugal Braces for Government Collapse

THE WALL STREET JOURNAL: LISBON, Portugal—Portugal's government could collapse Wednesday after opposition parties withdrew their support for another round of austerity policies aimed at averting a financial bailout.

The expected defeat of the minority government's latest spending plans in a parliamentary vote will likely force its resignation and could stall national and European efforts to deal with the continent's protracted debt crisis.

The vote comes on the eve of a two-day European Union summit where policy makers are hoping to take new steps to restore investor faith in the fiscal soundness of the 17-nation euro zone, including Portugal.

Last year, both Greece and Ireland had to accept massive rescue packages after markets lost faith in their governments' efforts to deal with their debt burdens.

The political tension fueled a rise in Portugal's borrowing rates, just as it is trying to cut spending. The yield on the country's 10-year bond, for example, was up to 7.57%Tuesday—just shy of its euro-era record level. The interest rate has been above 7% for several weeks despite the government's earlier austerity measures that, its political rivals say, failed to quell investor fears.

As in Greece, the austerity policies—including tax hikes and pay cuts—have prompted an outcry from trade unions and numerous demonstrations and strikes. Train engineers walked off the job during the morning commute Wednesday, causing widespread travel disruption.

By most measures, Portugal is one of the euro zone's smallest and feeblest economies but its financial collapse would likely trigger a fresh bout of nerves over other debt-heavy—and bigger—euro countries such as Spain, Belgium and Italy.

"Portugal seems very likely to become the third … eurozone country to need a bailout," Emilie Gay, European economist at Capital Economics, said. » | Associated Press | Wednesday, March 23, 2011
Judge Slams Google Books

A federal judge rejected a Google settlement that would allow it to post millions of books online. It's the latest blow in Google's long effort to scan and make books available electronically. Amir Efrati explains the latest to Stacey Delo

Mallory Factor: Nicole Gelinas

Nicolas Sarkozy Makes Populist Play for Welfare in Country that Still Cares

THE GUARDIAN: Cross-party commitment to welfare means France is a good place to be old, young, sick, jobless or female

The future of social care, President Nicolas Sarkozy declared, "is a matter of such importance and gravity that ideology has no place". His opponents scoff, among them Martine Aubry, one of the frontrunners to be the Socialist party's candidate against him in the presidential elections due in 2012.

Viewed from the British side of the Channel, Sarkozy has made a striking promise to create a "new branch of the welfare state" to provide care for old people and those with disabilities. France has 1.1 million dependent old people, their numbers expected to grow by 1%-2% to the middle of the century, when the over‑85s could number 5 million.

Alarmist voices have sounded, but France has heard little of the partisan hysteria audible in Britain, where spending on care for old people has been proportionately higher than in France. Sarkozy promises to lay out a plan by this summer, in good time to give him a populist theme for the presidential campaign. (By then we ought to have sight of proposals to come from Andrew Dilnot, the Oxford economist commissioned by the Cameron government to rethink social care; they will make for a fascinating comparison.)

It's true that Sarkozy, after grandstanding on social care when he was elected in 2007, has vacillated. His latest line is that social care won't be a formal "fifth branch" of the French welfare state. Its four pillars are family benefits, health, coverage for accidents at work, and pensions. They offer relatively generous statutory entitlements, funded by insurance schemes paid for by statutory employer and employee contributions, topped up by general taxation. Instead, Sarkozy's extension of social care is to come from private insurance, some tax funding or even (this came from Laurent Hénart, the president of the national agency for personal services and a pro-Sarkozy MP) the proceeds of French workers giving up a day's leave each year. But the state will organise and underpin it.

How unlike Britain: in France, cross-party commitment to welfare runs deep, as does belief in the necessity and benignity of "l'état". Politicians on the right and the left use the word solidarité with sincerity (the National Front is statist, too, though its definitions exclude "immigrants" from the national compact). Perhaps solidarity is the modern expression of the 1789 cry for "fraternity". The Sarkozy government has a minister for solidarity and maintains the solidarity tax, only one of several payments by general taxpayers and employers levied in the name of strengthening social cohesion. On the annual journée de solidarité employees' pay is earmarked for old people's charities. Continue reading and comment » | Polly Toynbee | Tuesday, March 22, 2011

Tuesday, 22 March 2011

Inflation and Public Borrowing Add to Budget 2011 Headaches

THE GUARDIAN: • Consumer price index hits 4.4% for February • Public sector net borrowing for February at £10.3bn • Hopes dashed of big cut in deficit • News increases chance of cautious budget package

George Osborne was handed a double dose of unwelcome pre-budget news on Tuesday when official figures showed inflation leaping to 4.4% and public borrowing hit its highest February level since modern records began in 1993.

With the chancellor putting the finishing touches to his second package of fiscal measures, the rise in inflation put additional pressure on the Bank of England to raise interest rates while the deterioration in the public finances put paid to City hopes that borrowing in 2010-11 would significantly undershoot the government's £148bn target.

The disappointing economic news increases the chances of a cautious package from Osborne on Wednesday. The setback to the public finances gives the chancellor even less scope for budget giveaways and he will see a tough fiscal stance as necessary to prevent the Bank from raising interest rates.

Higher heating costs, the soaring price of oil and mark-ups from clothing and footwear retailers were mainly responsible for the increase in the consumer prices index measure of inflation from 4% to a 28-month high of 4.4%, according to the Office for National Statistics. » | Larry Elliott, economics editor | Tuesday, March 22, 2011

THE GUARDIAN: Inflation hits 4.4% in February: Retail prices index, which includes housing costs, hit 5.5% - its highest level since July 1991 » | Graeme Wearden | Tuesday, March 22, 2011

Sunday, 20 March 2011

Bahrain Unions to Extend Strike

THE WALL STREET JOURNAL: MANAMA—Bahrain's largest trade union Sunday called for nationwide strikes to be prolonged until foreign troops are withdrawn from the kingdom and pro-government militias are disbanded, posing another threat to Bahrain's fragile economy.

Speaking after a meeting of the General Federation for Bahrain Trade Unions, which represents more than 60 trade unions across Bahrain, general secretary Sayed Salman said that unions wanted to avoid causing lasting damage to the economy, but were left with no choice but to extend the general strike. He said foreign troop intervention and mounting attacks on Bahraini workers by armed government loyalists are "unacceptable."

"As of now 70% of Bahraini workers are on strike and in this situation we cannot call our people back to duty. We hope that it won't be a long time as our workers are also suffering, but we want all the militias and foreign forces to be taken off the streets...The situation here is unacceptable," Mr. Salman said in an interview.

The trade union group represents workers from across Bahrain's services and construction sectors, including Gulf Air, the national carrier, and Bapco, the island's largest oil company.

An official from the Bapco trade union said that the refinery, which has the capacity to produce more than 250,000 barrels a day of crude, has partially shut down production owing to staff shortages.

"Only 10% is working properly at BAPCO…80-85% of production and distribution is now affected," the union official said.

Bahrain's government has urged employees to return to work after days of closures and shortened hours. But the announcement of persistent large-scale strikes could aggravate the problems facing Bahrain's economy. Over a month of antigovernment protests has seen hotels and restaurants report a collapse in bookings, and fed fears about Bahrain's status as a financial center. » | Joe Parkinson | Sunday, March 20, 2011
U.S., Brazil Push Investment, Trade Agendas

THE WALL STREET JOURNAL: BRASILIA -- At the outset of a three-country tour of Latin America, President Barack Obama heaped huge praise on Brazil's remarkable economic rise, but received a tongue lashing in return from Brazilian President Dilma Rousseff, who criticized the U.S. loose monetary policy for contributing to "acute" global imbalances by artificially weakening the U.S. dollar.

A joint appearance by the two leaders in Brazil's futuristic presidential palace was perhaps most remarkable for the subject that barely came up: The near simultaneous launching of U.S.-backed military engagements in Libya. Near the end of his remarks, Mr. Obama said the United Nations coalition, led by France and the U.K., was ready to "act with urgency." More details weren't available from the president, since Brazil did not allow reporters to ask questions.

So, as French jets took to the air over Libya, Mr. Obama spoke mainly on economic cooperation with Brazil, joking once about his disappointment that Chicago lost the 2016 Olympics to Rio de Janeiro. Later, Mr. Obama gave more extensive statements on Libya to U.S. reporters travelling with him.

Indeed, Mr. Obama's Latin American trip, which also includes Chile and El Salvador, is certain to be overshadowed the escalating hostilities. The visit is meant to reestablish the U.S. presence as an economic partner as Brazil and other resource rich Latin nations forge closer ties with China. But even before departing, Mr. Obama was criticized for leaving the U.S. amid international turmoil and pressing domestic budget debates. » | Paulo Prada, Laura Meckler in Brasilia, Tom Murphy in San [São?] Paulo | Saturday, March 19, 2011

WIKI: Dilma Rousseff, President of Brazil »

Saturday, 19 March 2011

Tokyo Businesses Struggle after Quake

Mar 19 - Tourists stay away from the Japanese capital leaving local businesses to struggle. Andrew Raven reports

Counting the Cost - Japan: The Cost of Disaster

On this week's Counting the Cost we look at: The economic impact of the catastrophe in Japan, the global nuclear power debate and an unexpected pastime in Afghanistan - skiing.

Thursday, 17 March 2011

Cost of Japan Quake May Top $200 Bln

Mar 16 - Japan's devastating earthquake and deepening nuclear crisis could result in losses of up to $200 billion for the world's third largest economy, but the global impact remains hard to gauge. Ciara Sutton reports

REUTERS: Analysis: Japan heading back into recession – Japan's economy seems to be in a state of almost suspended animation as its nuclear crisis shows no sign of ending, sorely testing analysts' hopes for a swift rebound led by reconstruction efforts. » | Wayne Cole | SYDNEY | Thursday, March 17, 2011

Wednesday, 16 March 2011

Wall St. Recovers from Session Lows

Mar 15 - Summary of business headlines: Wall Street closes lower on Japan concerns; Fed holds rates steady; Oil prices drop; Apple delays Japan launch of iPad 2. Bobbi Rebell reports

Tuesday, 15 March 2011

Wall Street Tumbles as Japan Fuels Gobal [sic] Sell-off

THE DAILY TELEGRAPH: Wall Street fell 2pc on Tuesday as a global stock market sell-off intensified with investors dumping shares in a flight to safety, panicked by Japan's growing nuclear crisis.

The Dow Jones Industrial Index dropped 2.3pc - or 280 points - to 11,699.96 within minutes of opening, with shares seen as exposed to the disaster sliding. Insurer AIG fell 4pc and General Electric fell 5pc.

European bourses were dragged lower. Britain's FTSE 100 fell 2.6pc - or 154 points - to a fresh year low of 5622.53 at 1.30pm in London, wiping around £32bn off the value of the blue-chip index. Germany's DAX plunged 4.8pc and France's CAC 3.9pc.

The fall followed a 10.6pc dive - 14pc at one stage - in Japan's Nikkei after the government warned of dangerous levels of radiation following a third explosion at the earthquake-damaged Fukushima nuclear plant. The benchmark index ended down 1,015.34 points at 8,605.15, while the broader Topix plunged 9.5pc in its worst two-day fall since 1987.

This caused a ripple effect through Asia, Europe and the United States as investors reassessed the impact of last Friday's earthquake and tsunami and the growing nuclear disaster on a fragile global economy.

Brent crude dropped $4.80 to $108.93 a barrel in London and fell below $100 in New York as markets bet on a dramatic loss of demand for oil from the world's third largest economy.

"Last night’s move was the third worst decline in the Nikkei’s history and there’s fear that there could be more to come," said Simon Denham, the managing director of Capital Spreads. » | Tuesday, March 15, 2011
Dispatches: Britain's Secret Fat Cats

On the eve of a major report looking at public sector pay, Dispatches investigates whether private outsourcing companies are benefiting from government cuts

Watch the programme here
Dispatches: Selling Off Britain

Join Channel 4 News presenter Krishnan Guru-Murthy and a host of experts in this studio debate - recorded and originally shown live - and play our 'sell or not game' to vote on which assets you want us to flog or keep.
Dispatches reveals the billions of pounds worth of assets we own as a nation, from ancient silver candlesticks to missiles, from football clubs to huge houses for judges to sleep in. Should we sell the government wine cellar, Gibraltar, Buckingham Palace? The entire armed forces? Or even Birmingham? Should we be selling these off rather than sacking council workers and cutting the NHS? And how far should we go?

Watch the programme here
Les Bourses européennes dans la tourmente

LE FIGARO: Le CAC 40 perd plus de 3% et s'enfonce sous les 3800 points. Londres et Milan suivent le même chemin tandis que Francfort lâche 5%. Les opérateurs s'inquiètent de l'aggravation de la situation nucléaire du Japon.

Encore une journée morose à la Bourse de Paris. Le CAC 40, qui a plongé sous les 3900 points hier, reste ce mardi ancré dans le rouge. Après un démarrage en forte baisse de 2,17% à 3793,95 points, l'indice phare de Paris creuse ses pertes et lâche 3,43% à 3744 points vers 10h30. À Londres et Milan, les Bourses suivent le même chemin et abandonnent également plus de 3%. La Bourse de Francfort creuse ses pertes à près de -5%.

Les indices ont du mal à retrouver le chemin de la hausse alors que la situation nucléaire japonaise s'est encore aggravée. Une nouvelle explosion et un incendie ont eu lieu au sein de la centrale de Fukushima Dai-ichi. «Le niveau de radioactivité a considérablement augmenté» et devient dangereux pour la santé, a déclaré le premier ministre japonais, Naoto Kan, à la télévision, provoquant un vent de panique sur les marchés d'Asie. La Bourse de Tokyo, pour sa part, s'est écroulée de 10,55%. » | Par Hayat Gazzane | Mardi 15 Mars 2011

THE DAILY TELEGRAPH: London joins global sell-off as Japan crisis fuels panic: London shares fell sharply on Tuesday as investors in Europe joined a global market sell-off that started with a 10.55pc plunge in the Nikkei as panicked investors dumped stocks in the face of an escalating nuclear crisis in Japan. » | Tuesday, March 15, 2011
Japan Shares Tumble as Nuclear Crisis Fears Create Panic

THE DAILY TELEGRAPH: Tokyo shares closed down 10.55pc on Tuesday as panicking investors dumped stocks after the government said levels of radiation leaking from a stricken nuclear plant posed a threat to health.

Japan's Nikkei index clawed back some ground from an earlier freefall - sliding more than 12pc at one stage - to close down 1,015.34 points at 8,605.15. The broader Topix plunged 9.5pc in its worst two-day fall since 1987.

Other Asian markets suffered a ripple effect as investors fled stocks as the crisis in the world's No. 3 economy seemed only to escalate after a third explosion at the crippled Fukushima Dai-ichi nuclear plant in Fukushima province. » | Tuesday, March 15, 2011

Monday, 14 March 2011

Dollar Rises from Near-record Lows vs Yen after Quake

REUTERS: The dollar rebounded from near-record lows against the yen on Monday, boosted by hedge fund buying as the Bank of Japan's huge infusion into money markets helped ease nervousness triggered by the massive earthquake and tsunami in northeast Japan. >>> Gertrude Chavez-Dreyfuss | TOKYO | Monday, March 14, 2011
Japan Shuts Down as Economic Fears Grow

THE DAILY TELEGRAPH: Japan's giant car industry has announced a major shutdown as fears grow over the economic impact of Friday’s devastating earthquake and subsequent tsunami which has crippled much of the north-east of the country.

The three largest motor manufacturers – Toyota, Honda and Nissan – said they would stop production at almost all of their domestic assembly plants. The safety of the workforce and deaths were cited as reasons behind the decision. The electronics giant Sony also said it would be shutting down production.

Gerard Lyons, chief economist at Standard Chartered, warned of possible temporary price stagflation and an initial downward move for the country’s economy.

“The timing of the disaster could not have been much worse,” admitted analysts at Capital Economics, pointing to Japan’s economic contraction in the last three months of 2010.

The disaster forced the Bank of Japan (BoJ) to issue a statement, as it draws up plans for an emergency “quake budget”. The BoJ said: “The bank will continue to do its utmost, including the provision of liquidity, to ensure stability in financial markets and to secure the smooth settlement of funds, in the coming week.”

Naoto Kan, the Japanese prime minister, asked BoJ to “save the country” after politicians from both sides of the political spectrum agreed on the need for the budget to introduce emergency spending to fund rescue and clean-up efforts and to resuscitate the economy. Continue reading and comment >>> James Quinn and Jamie Dunkley | Saturday, March 12, 2011

Sunday, 13 March 2011

Burger King Boss Insults British

THE SUNDAY TELEGRAPH: The chief executive of Burger King has described British women as ugly and English food as “terrible”, in a gaffe likely to enrage his customers in this country.

Bernardo Hees, 40, told a group of students in Chicago that “here the food is good and you are known for your good-looking women”.

Comparing the city to his student days at the University of Warwick, where he studied for an MBA, he recalled of his time in England: “The food is terrible and the women are not very attractive."

His gaffe came only six months after taking the helm at the chain, which has 11,500 outlets worldwide, and unsurprisingly were not welcomed in Coventry, where Warwick University is based.

Charli Fritzner, women’s campaigns officer at the University’s student union, said: “If he views women as potential distractions in academia, I wonder how he views them in the workplace?

“It doesn’t make Burger King an attractive employer for women.”
Marcus Wareing, a Michelin-starred chef at London’s Berkeley Hotel, who specialises in English produce, said his comments were an “insult to British gastronomy”, especially given what the Burger King menu contains. >>> Nick Britten | Sunday, March 13, 2011

Friday, 11 March 2011

Denmark to Swap Stamps for Texts

BBC: People stuck for a stamp in Denmark will soon be able to send a text message to pay the postage on a letter.

From 1 April, the Danish post office is introducing The Mobile Postage service that does away with stamps for standard sized letters.

Instead, people will send a text to the post office and get back a code they write on the envelope.

Sweden's post office said it was also considering introducing the service and is planning trials. >>> | Friday, March 11, 2011
News Hub: Dow Falls 228 Points, Dips Below 12000

Stocks closed with broad, steep losses Thursday after rumblings of unrest in Saudi Arabia compounded economic worries abroad and in the U.S. Jonathan Cheng has details

Brace for $200 Oil If Unrest Hits Saudi Arabia

Commentary: Riyadh pulls the strings on global markets’ next act

MARKET WATCH: SEATTLE — Strong markets are supposed to rise along a wall of worry. This one was rising very nicely amid plenty of worries until investors caught a whiff of the idea that Saudi Arabia could fall victim to the unrest enveloping the Middle East.

So now stocks are slipping and crawling. It’s all about the optics. If you can see a problem, then you can ignore it. But if you aren’t sure what you see, paralysis ensues.

Any real threat that the Fahd monarchy and Sunni hegemony in Saudi Arabia could possibly come under attack would spark more than a worry. It would be thunder, lightning, a hurricane, a tornado, a tidal wave and earthquake all rolled up in one sand-colored bombshell.

No one really cares about Libya, after all. The two sides there can blast each other to kingdom come for all that most investors in London, Paris, Frankfurt and Wall Street care. Sure, there’s a decent amount of oil at stake at Bayda, Benghazi & Beyond, but concerns about the region begin and end at Saudi borders. >>> Jon Markman, MarketWatch | Thursday, March 10, 2011

Thursday, 10 March 2011

Most Britons Face 60 Percent Income Loss in Retirement

REUTERS UK: Almost two-thirds of people living in Britain today are likely to see a 60 percent drop in their income when they retire over the next 40 years and a plummeting quality of life, a report said Thursday.

The 15 million households earn between 18,000 and 44,000 pounds each and represent roughly 35 million people, according to the study by London's Chatham House think-tank.

Their incomes will take the biggest hit from retirement compared to the lowest and highest 20 percent of earners.

"The UK has a distinct problem with middle-income earners who are failing to save enough and are likely to find the drop in income during retirement unexpected and unacceptable," said Paola Subacchi, one of the report's authors. >>> Reporting by Olesya Dmitracova; Editing by Steve Addison | London | Thursday, March 10, 2011
Trouble for Libya's Oil Industry

As the battle for Libya intensifies, oil production in the country has plummeted. In the rebel-held east it's down by as much as 90 percent. Now OPEC is considering boosting output for the first time in two years. Al Jazeera's Alan Fisher reports

Wednesday, 9 March 2011

Amanda Lamb: Top Tips to Find Your Place in the Sun

Express - Amanda Lamb: Tops tips to find a place in the sun
Niall Ferguson: China Will Overtake the US within a Decade

Niall Ferguson, historian and author of Civilization, tells Robert Miller that the credit crisis means China's economy will overtake the US much quicker than expected

Watch Telegraph video here | Monday, March 07, 2011
Oil Markets Brace for Saudi 'Rage' as Global Spare Capacity Wears Thin

THE DAILY TELEGRAPH: Those exhorting OPEC to boost output should be careful what they wish for. The cartel card can be played once only, and it risks exposing the fragility of the global energy system if the Gulf powers are seen struggling to deliver.

Goldman Sachs suspects that OPEC has been pumping far above its agreed quota since November and therefore cannot easily raise output much without cutting deep into global spare capacity.

Jeff Currie, the bank's oil guru, said Saudi output had quietly crept up by 700,000 barrels a day (bpd) even before the Libyan supply shock.

Assumptions that OPEC has added 1.9m bpd over the last two years are wishful thinking. These new fields have been "largely offset" by attrition in old fields.

"We believe that OPEC spare capacity has already dropped below 2m bpd. The question therefore arises how much spare capacity is left to absorb potential supply disruptions in other countries," he said.

If this picture is broadly correct, spare capacity is already close to the wafer-thin levels that led to wild price moves in mid-2008.

The flow of Libyan oil has so far fallen by 1m bpd. This may not sound much against global supply of 88m, but oil prices are determined by levels of spare capacity once supply tightens.

Beyond a certain point, the price spiral can kick in with explosive force until the economic damage crushes demand.

Libya's conflict has already cut spare capacity by a third. Hopes for a quick solution are fading as the country succumbs to civil war along ancient lines of tribal cleavage. A raft of new projects planned for the Sirte Basin by mid-decade will be mothballed. >>> Ambrose Evans-Pritchard, International Business Editor | Tuesday, March 08, 2011
Warning of ‘Food Price Riots in the UK’

YAHOO! FINANCE: A senior economist at the worldwide bank HSBC (LSE: HSBA.L - news) has warned of civil unrest in Britain if food prices continue to soar.

Speaking on Jeff Randall Live, senior global economist Karen Ward cautioned that the UK could experience the kind of food riots seen in other countries.

"Even in the developed world I think we have very, very low wage growth, so people aren't getting more in their pay packet to compensate them for food and energy, and I think we could see social unrest certainly in parts of the developed world and the UK as well."

She (SNP: ^SHEY - news) went on to highlight the link between high food prices and the escalating cost of crude oil.

"More and more we are seeing that some of these foodstuffs are actually substitutes for energy itself, particularly biofuels. So I think the energy markets are a significant contributor to these food price gains."

The comments come as the United Nations warned the cost of food is now at the highest level for 21 years and set to rise further. >>> SKY NEWS | Tuesday, March 08, 2011
Shares Bonanza For State-Owned Bank Chief

SKY NEWS: Royal Bank of Scotland boss Stephen Hester has been awarded an extra shares bonus worth up to £4.5m - taking his pay package for 2010 to a potential £7.7m.

The award - made under the bank's long-term incentive plan - is on top of a £2m annual bonus already confirmed by the group and Mr Hester's £1.2m salary.

He also stands to pick up six million shares as part of his 2011 maximum annual bonus.

Based on the current share price, these would be worth around £2.7m.

RBS has also revealed bonus payments for a raft of other executives at the bank, which is 83% owned by the taxpayer.

They include a £1.4m annual handout and potential £2.8m long-term incentive payout for finance boss Bruce Van Saun. >>> Graham Fitzgerald, Sky News Online | Tuesday, March 08, 2011

Big Bonus For Barclays Boss

The boss of Barclays, Bob Diamond, is to get a £6.5m bonus

Tuesday, 8 March 2011

Higher Oil Keeps Wall St. On Edge

Mar 7 - Summary of business headlines: U.S. crude rallies above $105 as violence in Libya continues; U.S. consumer credit up in January but consumers show sign of restraint; Stocks fall in U.S. and Europe. Conway G. Gittens reports

State Pension Reform: £140 a Week for Everyone

THE DAILY TELEGRAPH: Pensioners are to receive a flat-rate universal retirement payment of £140 a week that will end the injustice of working mothers being penalised for taking a break to raise children, under reforms to be signalled by Iain Duncan Smith today.

The Work and Pensions Secretary will pledge to sweep away a host of complex rules and "fundamentally simplify" the basic state pension.

Insiders said Mr Duncan's Smith's intervention represents the start of a Coalition drive to replace the existing state pension regime with a "single tier" retirement payment.

Official estimates suggest that many women who take time out from work for family reasons are left up to £40 a week worse off by rules that base pension payments on National Insurance contributions.

Charities said a universal pension would "reduce fear for those approaching retirement."

In a speech to charity leaders and pension experts, Mr Duncan Smith will condemn the pension system as a bureaucratic mess that leaves many people confused and puts young people off saving. >>> James Kirkup, Political Correspondent | Monday, March 07, 2011

THE DAILY TELEGRAPH: Pension changes Q&A: who will win and lose? – News that the Government plans to introduce a universal state pension have been welcomed by many. It will replace the current hotchpotch of basic state pension, earnings-related “top-up” payments, plus additional means-tested benefits. >>> Emma Simon | Monday, March 07, 2011
Greek Debt Price Soars as Moody's Cuts Credit Rating Below Egypt

THE DAILY TELEGRAPH: The Greek government has reacted angrily to Moody's decision to cut the country's credit rating below that of Egypt, a move that prompted investors to dump the debt of other struggling European economies.

The country's debt was lowered to B1 from Ba1, as the ratings agency warned that Greece faces a shortfall in tax revenue and huge challenges in reforming state-owned companies and its costly healthcare system.

"The sheer magnitude of the task is becoming ever more apparent," said Sarah Carlson, an analyst at Moody's.

The Greek Finance Ministry yesterday described Moody's move as "totally unjustfied".

"Having completely missed the build-up of risk that led to the global financial crisis in 2008, the rating agencies are now competing with each other to be the first to identify risks that will lead to the next crisis," it said. Continue reading and comment >>> Richard Blackden | Monday, March 07, 2011

Saturday, 5 March 2011

Oil Prices Flare on Libya Fighting

Mar 4 - Summary of business headlines: Oil hits fresh 2-1/2 year high as Libyans take up arms, Wall Street knocked lower; U.S. enjoys strongest job creation in nine months, falling unemployment rate; Galleon hedge fund founder heads to court ahead of insider trading trial. Conway G. Gittens reports

Britain at Risk of Another Financial Crisis, Bank of England Chief Warns

THE DAILY TELEGRAPH: Britain risks suffering another financial crisis without reform of the country’s banks, the Governor of the Bank of England warns today.

In an interview with The Daily Telegraph, Mervyn King says that “imbalances” in the banking system remain and are “beginning to grow again”.

Mr King urges high street banks to take a better, longer term view towards their customers and to stop focusing on the need to “simply maximise profits next week”.

He accuses them of routinely exploiting their millions of customers. “If it’s possible [for financial services firms] to make money out of gullible or unsuspecting customers, particularly institutional customers, [they think] that is perfectly acceptable,” he says.

The Governor criticises the “weight put on the importance and value of takeovers” and raises concerns that companies with good reputations have been “destroyed” in the search for short-term profits.

Mr King expresses regret for not sounding a louder warning over his concerns before the last banking crisis.

The Governor’s remarks are a warning to George Osborne, the Chancellor, as a government commission considers whether to force high street banks to sell off their investment banking arms. Continue reading and comment >>> Robert Winnett, Deputy Political Editor | Friday, March 04, 2011

Friday, 4 March 2011

Why the Dollar's Reign Is Near an End

THE WALL STREET JOURNAL: For decades the dollar has served as the world's main reserve currency, but, argues Barry Eichengreen, it will soon have to share that role. Here's why—and what it will mean for international markets and companies.

The single most astonishing fact about foreign exchange is not the high volume of transactions, as incredible as that growth has been. Nor is it the volatility of currency rates, as wild as the markets are these days.

Instead, it's the extent to which the market remains dollar-centric.

Consider this: When a South Korean wine wholesaler wants to import Chilean cabernet, the Korean importer buys U.S. dollars, not pesos, with which to pay the Chilean exporter. Indeed, the dollar is virtually the exclusive vehicle for foreign-exchange transactions between Chile and Korea, despite the fact that less than 20% of the merchandise trade of both countries is with the U.S.

Chile and Korea are hardly an anomaly: Fully 85% of foreign-exchange transactions world-wide are trades of other currencies for dollars. What's more, what is true of foreign-exchange transactions is true of other international business. The Organization of Petroleum Exporting Countries sets the price of oil in dollars. The dollar is the currency of denomination of half of all international debt securities. More than 60% of the foreign reserves of central banks and governments are in dollars.

The greenback, in other words, is not just America's currency. It's the world's.

But as astonishing as that is, what may be even more astonishing is this: The dollar's reign is coming to an end.

I believe that over the next 10 years, we're going to see a profound shift toward a world in which several currencies compete for dominance.

The impact of such a shift will be equally profound, with implications for, among other things, the stability of exchange rates, the stability of financial markets, the ease with which the U.S. will be able to finance budget and current-account deficits, and whether the Fed can follow a policy of benign neglect toward the dollar. >>> Barry Eichengreen | Wednesday, March 02, 2011

Dr. Eichengreen is the George C. Pardee and Helen N. Pardee professor of economics and political science at the University of California, Berkeley. His new book is "Exorbitant Privilege: The Rise and Fall of the Dollar and the Future of the International Monetary System." He can be reached at

Verbunden >>>
Oil Backs Down

Mar 3 - Summary of business headlines: Oil prices fall as Libyan peace proposal emerges; U.N. food index hits record high; U.S. economy growing despite inflation scare; Stocks rally ahead of jobs report. Conway Gittens reports

Thursday, 3 March 2011

Apple Shares Rise on Jobs Return

Mar 2 - Summary of business headlines: Apple shares rally as Steve Jobs returns to unveil iPad 2; U.S. crude rallies above $102; Economic recovery slowly moving along - Fed; Wall Street rallies despite higher oil prices. Conway G. Gittens reports

Saudi Arabia Contagion Triggers Gulf Rout

THE DAILY TELEGRAPH: Fears of sectarian uprisings in Bahrain and Saudi Arabia have set off the first serious wave of investor flight from the Gulf, compounding market turmoil as civil war in Libya pushes Brent crude over $116 a barrel.

Saudi Arabia’s Tadawul stock index has tumbled 11pc in wild trading over the past two days, led by banks and insurers. Dubai’s bourse has hit a 7-year low.

The latest sell-off was triggered by the arrest of a Shi’ite cleric in the Kingdom’s Eastern Province after he called for democratic reforms and a constitutional monarchy. The province is home to Saudi Arabia’s aggrieved Shi’ite minority and also holds the country’s vast Ghawar oilfield, placing it at the epicentre of global crude supply.

“Unrest in this region can have fatal consequences for the world,” said JBC Energy. “The plunge on the Saudi stock exchange can be interpreted as a sign of waning trust.”

In Bahrain, the island nation’s Sunni elite holds sway over a Shi’ite majority that is denied key jobs and has a token political voice, making it a trial run for Saudi Arabia’s near-identical tensions in the Eastern Province.

Bahraini dissidents have so far been much bolder, prompting a bloody crackdown last month when at least seven people were shot by the military. The ruling family – under intense pressure from Washington to stop the killings – has since held out an olive branch to protesters and let the radical Haq leader Hassan Mushaima return from exile, yet the crisis is far from contained.

My Mushaima said on Wednesday that protesters have “the right to appeal for help from Iran” if Saudi military units interfere in the struggle. Tanks were seen crossing the 17-mile causeway from Saudi Arabia to Bahrain on Tuesday.

“These were supposed to be Bahrain’s tanks returning from Kuwait: that is not a credible story,” said Siras Abi Ali, a Gulf expert at the risk group Exclusive Analysis.

He said the outcome in Bahrain will set the template for events across the border. “There is no good outcome from this for Saudi Arabia. If Bahrain offers concessions, the Saudi Shia will demand similar concessions. If they crack down, they risk an uprising. These people do not want to live under the House of Saud,” he said. >>> Ambrose Evans-Pritchard, International Business Editor | Wednesday, March 02, 2011
Ausweitung der Yuan-Menge: China attackiert den Dollar

Dollar- und Yuan-Noten: Drohende Dollar-Dämmerung. Bild: Spiegel Online

SPIEGEL ONLINE: Die chinesische Notenbank überrascht mit einer spektakulären Ankündigung: Die angehende Supermacht will ihren kompletten Außenhandel künftig in Yuan abwickeln, nicht mehr in Dollar. Peking rüttelt an Amerikas Anspruch, die Leitwährung zu stellen - mit gravierenden Folgen für die USA.

Berlin - Es ist unscheinbare Ankündigung, doch sie hat das Potential, das Machtgefüge auf dem Weltwährungsmarkt nachhaltig zu verändern: China stärkt die internationale Rolle des Yuan. Alle Exporteure und Importeure sollen noch in diesem Jahr die Geschäfte mit ihren ausländischen Partnern in Yuan abrechnen können, teilte die Zentralbank am Mittwoch in Peking mit.

Damit werde auf die wachsende Bedeutung des Yuan als weltweite Reservewährung reagiert. "Die Marktnachfrage nach einer grenzüberschreitenden Verwendung des Yuan steigt", erklärte die Zentralbank. Testweise wurde bereits im vergangenen Jahr 67.000 Unternehmen in 20 Provinzen erlaubt, ihre Auslandsgeschäfte in Yuan abzuwickeln. Das Handelsvolumen belief sich auf umgerechnet rund 56 Milliarden Euro.

Jetzt soll die Yuan-Menge ausgeweitet werden, es sollen deutlich mehr Geschäfte in der chinesischen Währung abgewickelt werden - und weniger in der amerikanischen. Chinesische Unternehmen handeln zurzeit oft in Dollar, sie sind dadurch abhängig von den Entscheidungen der US-Notenbank Fed, zahlen bei einem steigenden Ölpreis drauf und müssen höhere Transaktionsgebühren als nötig berappen. Das soll sich jetzt ändern.

Langfristig will die Volksrepublik sogar noch weiter gehen. Sie will den streng reglementierten Yuan schrittweise in eine frei konvertierbare Weltwährung aufbauen. >>> ssu/AFP/Reuters | Mittwoch, 02. M¨rz 2011

Diskutieren Sie über diesen Artikel >>>

Wednesday, 2 March 2011

Libya Hopes Oil Does Not Become Weapon

REUTERS: Libya hopes tensions with Western countries over a popular revolt in the country do not reach the stage where the Tripoli government considers oil as a political weapon, a top oil official said on Wednesday.

Shokri Ghanem, chairman of Libya's National Oil Corporation, also told Reuters in an interview that Libya's troubles had created the country's worst energy crisis in decades and Libyan supply disruptions to world markets could push oil above $130 a barrel in the next month if troubles persist.

Oil markets will be watching closely to see if the departure of oil workers fearful of violence in Libya will further cut output in the world's 12th largest exporter. >>> Reporting by Michael Georgy; editing by Keiron Henderson | Tripoli | Wednesday, March 02, 2011
Wall Street Rattled by $100 Oil

Mar 1 - Summary of business headlines: Oil spikes close to $100 on Middle East worries causing a 1.5 percent drop across Wall Street; Fed chief thinks price spike will be short; Factory activity, auto sales point to stronger recovery. Conway Gittens reports

Anger at the Banks Is Justified, Mervyn King Says

THE DAILY TELEGRAPH: The Governor of the Bank of England, Mervyn King, has expressed "surprise" that the public is not more angry with the bankers who caused the recession.

In some of his strongest language yet, Mervyn King today claimed the fall in households' living standards was the fault of the financial services sector and he expressed sympathy that innocent families paying the price.

"The people whose jobs were destroyed were in no way responsible for the excesses of the financial sector and the crisis that followed," he told MPs on the Treasury Select Committee.

In most aspects, he said, the economy had been on a sound footing before the crisis. Previous downturns were often caused by inefficiencies or weak management and were useful opportunities to improve systems. "None of that applied in this crisis," he said. "We had quite a successfully operating economy."

The people who are now suffering "did not get bonuses of the scale people in the financial sector got". The financial crisis may have occurred two years ago but, as austerity measures kick in, "the cost is now being felt", he said.

It remains "a big political problem", he added: "I'm surprised the real anger hasn't been greater than it has." >>> Philip Aldrick, Economics Editor | Tuesday, March 01, 2011