Kuwait's sovereign wealth fund has made a $1bn profit after selling its stake in Citigroup for $4.1bn less than two years after acquiring preferred shares the US's largest bank during the financial crisis.The Kuwait Investment Authority said on Sunday it had sold its entire stake in the US bank, earning the sovereign wealth fund a 37 per cent return on its investment.The KIA sale comes as Citigroup is set to intensify efforts to break free from the US government's emergency bank funding programme.The KIA made the investment in Citi in January 2008 as struggling western banks looked to the oil rich Arab Gulf as a source of capital. It also invested $2bn in Merrill Lynch as Wall Street banks were hit by billions of dollars of writedowns linked to investments in the US property market.The decision by Bank of America last week to pay back $45bn of government money has increased the pressure on other borrowers from the US government's troubled asset relief programme, including Citigroup and Wells Fargo.
Kuwait's sovereign wealth fund has made a $1bn profit after selling its stake in Citigroup for $4.1bn less than two years after acquiring preferred shares the US's largest bank during the financial crisis.
The Kuwait Investment Authority said on Sunday it had sold its entire stake in the US bank, earning the sovereign wealth fund a 37 per cent return on its investment.
The KIA sale comes as Citigroup is set to intensify efforts to break free from the US government's emergency bank funding programme.
The KIA made the investment in Citi in January 2008 as struggling western banks looked to the oil rich Arab Gulf as a source of capital. It also invested $2bn in Merrill Lynch as Wall Street banks were hit by billions of dollars of writedowns linked to investments in the US property market.
The decision by Bank of America last week to pay back $45bn of government money has increased the pressure on other borrowers from the US government's troubled asset relief programme, including Citigroup and Wells Fargo.
International drug cartels have abandoned the US dollar for high denomination euros to launder millions in illegal profits, Europol has revealed. The gangs no longer use $100 bills because €500 notes - the largest denomination of euro - take up less room when transporting large amounts of cash across the world.In a single consignment on a British Airways plane bound for London from the United States, US police found £11m worth of drug profits in €500 bills. The Colombian and Mexican cartels' conversion to the European currency is even acknowledged in popular culture: American rapper Jay-Z's video for his single, Blue Magic, features a suitcase full of €500 notes as he sings about "the kilo business"
International drug cartels have abandoned the US dollar for high denomination euros to launder millions in illegal profits, Europol has revealed. The gangs no longer use $100 bills because €500 notes - the largest denomination of euro - take up less room when transporting large amounts of cash across the world.
In a single consignment on a British Airways plane bound for London from the United States, US police found £11m worth of drug profits in €500 bills. The Colombian and Mexican cartels' conversion to the European currency is even acknowledged in popular culture: American rapper Jay-Z's video for his single, Blue Magic, features a suitcase full of €500 notes as he sings about "the kilo business"
Something that was not true about 1000 DM notes....
ST. CROIX, U.S. Virgin Islands -- With federal agents mounting a probe into his offshore bank, billionaire Allen Stanford drove up a dirt road, hauling records from his headquarters to the top of a lush, tropical mountain. As the sun set over the island, the banker stuffed the papers into a steel drum, poured gasoline over the top and sparked a fire -- the flames rising into the sky.Months before his businesses exploded in February in a $7 billion fraud case, Stanford embarked on a mission to hide his financial records while trying to raise money to keep his banking empire alive. He would jet off to Libya to try to convince government leaders to invest in his offshore institution.He would even buy two Caribbean islands -- flipping the properties four times to inflate the value of the land and pump up the bank's assets."He was desperate,'' said Jonas Hagg, a longtime Fort Lauderdale executive chef who lived on Stanford's yacht. ``You never knew from day to day what was going to happen. He was flying by the seat of his pants.''
ST. CROIX, U.S. Virgin Islands -- With federal agents mounting a probe into his offshore bank, billionaire Allen Stanford drove up a dirt road, hauling records from his headquarters to the top of a lush, tropical mountain.
As the sun set over the island, the banker stuffed the papers into a steel drum, poured gasoline over the top and sparked a fire -- the flames rising into the sky.
Months before his businesses exploded in February in a $7 billion fraud case, Stanford embarked on a mission to hide his financial records while trying to raise money to keep his banking empire alive.
He would jet off to Libya to try to convince government leaders to invest in his offshore institution.
He would even buy two Caribbean islands -- flipping the properties four times to inflate the value of the land and pump up the bank's assets.
"He was desperate,'' said Jonas Hagg, a longtime Fort Lauderdale executive chef who lived on Stanford's yacht. ``You never knew from day to day what was going to happen. He was flying by the seat of his pants.''
The job market remains the worst since 1983, but November's unemployment rate improvement -- from 10.2 percent to 10 percent -- may begin feeding an employee exodus. Based on surveys, several management consulting and human resource organizations said about half of U.S. workers are likely to try to change jobs next year.Among the indicators: -- Right Management surveyed 900 workers and found that 60 percent intend to leave their jobs in 2010.-- The 2009 Employment Dynamics and Growth Expectations Report said 55 percent of employees plan to change jobs, careers or industries "when the economy recovers."-- CareerBuilder.com surveyed 4,285 full-time, private-sector employees. Forty percent said they had difficulty staying motivated in their current jobs, and 24 percent said they didn't feel loyal to their current employers.
The job market remains the worst since 1983, but November's unemployment rate improvement -- from 10.2 percent to 10 percent -- may begin feeding an employee exodus.
Based on surveys, several management consulting and human resource organizations said about half of U.S. workers are likely to try to change jobs next year.
Among the indicators:
-- Right Management surveyed 900 workers and found that 60 percent intend to leave their jobs in 2010.
-- The 2009 Employment Dynamics and Growth Expectations Report said 55 percent of employees plan to change jobs, careers or industries "when the economy recovers."
-- CareerBuilder.com surveyed 4,285 full-time, private-sector employees. Forty percent said they had difficulty staying motivated in their current jobs, and 24 percent said they didn't feel loyal to their current employers.
Millions of Americans -- 60 million, in fact -- conduct their day-to-day financial business outside the banking system, leaving many to be preyed upon by payday-loan companies, rent-to-own establishments and other non-bank institutions. Banks have largely ignored the unbanked and underbanked, arguing that it's difficult to figure out how to make money off them. But the Federal Deposit Insurance Corp. says it may look at using the Community Reinvestment Act -- and the weight that the act carries in bank examinations -- to encourage financial institutions to provide low-cost banking services and products. A new FDIC report found that 17 million U.S. adults are unbanked. An additional 43 million are classified as underbanked. You're considered unbanked if you don't have a checking or savings account. The FDIC defined underbanked households as those that have a checking or savings account but use non-bank money orders, check-cashing services, payday loans, rent-to-own agreements or pawnshops at least once a year.
Millions of Americans -- 60 million, in fact -- conduct their day-to-day financial business outside the banking system, leaving many to be preyed upon by payday-loan companies, rent-to-own establishments and other non-bank institutions.
Banks have largely ignored the unbanked and underbanked, arguing that it's difficult to figure out how to make money off them. But the Federal Deposit Insurance Corp. says it may look at using the Community Reinvestment Act -- and the weight that the act carries in bank examinations -- to encourage financial institutions to provide low-cost banking services and products.
A new FDIC report found that 17 million U.S. adults are unbanked. An additional 43 million are classified as underbanked.
You're considered unbanked if you don't have a checking or savings account. The FDIC defined underbanked households as those that have a checking or savings account but use non-bank money orders, check-cashing services, payday loans, rent-to-own agreements or pawnshops at least once a year.
FRANKFURT (Reuters) - The new head of Opel promised investments in new models and pledged to put an end to business as usual at the General Motors brand -- addressing two key grievances by unions when he outlined his turnaround plan this weekend. Newly anointed as Opel chief executive on Friday, Nick Reilly's first task will be convincing European governments to trust GM with about 3.3 billion euros ($5 billion) of their taxpayers' money to finance some 8,300 job cuts as part of a turnaround plan that would stanch all losses at the European carmaker by 2011. In return, Reilly wants to encourage entrepreneurial spirit at Opel as quickly as possible by delegating most decisions to country heads and dismantling GM's bureaucratic style of centralized management that fostered a debilitating culture of passing the buck. "It might seem obvious, but it isn't the way GM was managed and there was definitely some confusion about who was accountable," the 34-year company veteran told reporters this weekend. "From the top line of revenue to the bottom line of profit, this is now the responsibility of the managing directors of the major entities," Reilly explained. Local operations will now be free to decide on nearly everything from manufacturing to sales, except for key central responsibilities such as product planning and development, that will be run by new Opel Executive Frank Weber. .... The German government had repeatedly frowned on offering assistance unless a new strategic investor took over the reins at Opel and had heavily backed a deal with Canada's Magna out of fear Detroit could further damage Opel. In fact, Reilly's ideas strongly reflect the way Magna is run, which started out as a one-man company in 1957 only to became the world's fourth-largest auto parts supplier due to a corporate culture that emphasized decentralized structures, sharing best practice, employee participation and risk-taking.
Newly anointed as Opel chief executive on Friday, Nick Reilly's first task will be convincing European governments to trust GM with about 3.3 billion euros ($5 billion) of their taxpayers' money to finance some 8,300 job cuts as part of a turnaround plan that would stanch all losses at the European carmaker by 2011. In return, Reilly wants to encourage entrepreneurial spirit at Opel as quickly as possible by delegating most decisions to country heads and dismantling GM's bureaucratic style of centralized management that fostered a debilitating culture of passing the buck.
"It might seem obvious, but it isn't the way GM was managed and there was definitely some confusion about who was accountable," the 34-year company veteran told reporters this weekend. "From the top line of revenue to the bottom line of profit, this is now the responsibility of the managing directors of the major entities," Reilly explained.
Local operations will now be free to decide on nearly everything from manufacturing to sales, except for key central responsibilities such as product planning and development, that will be run by new Opel Executive Frank Weber.
....
The German government had repeatedly frowned on offering assistance unless a new strategic investor took over the reins at Opel and had heavily backed a deal with Canada's Magna out of fear Detroit could further damage Opel. In fact, Reilly's ideas strongly reflect the way Magna is run, which started out as a one-man company in 1957 only to became the world's fourth-largest auto parts supplier due to a corporate culture that emphasized decentralized structures, sharing best practice, employee participation and risk-taking.
In the Absence of Real Reform Real progress towards reducing the risks inherent in the U.S. financial system is unlikely. As long as there are financial institutions that are Too Big To Fail, we face a potential fiscal cost. We should recognize this in our government budget and balance sheet accounting. The overriding principle behind IMF fiscal assessments is the need to capture true total fiscal costs. Best practice for the U.S. needs to reflect this approach. All subsidies and taxation - including the entire cost of supporting the continued existence of large banks - should be reflected transparently in the budget and subjected to the prioritization of the budgetary process. Our current accounting for guarantees and governments' assumption of other contingent liabilities create the impression that government actions to support the banking system are costless. This is a dangerous illusion - as seen in the recent increase in US federal government deficit and debt. If we don't recognize these costs explicitly, we run the risk of taking on ever more contingent liability. If the financial system reaches the point where its failure cannot be offset by fiscal (and monetary) stimulus, then a Second Great Depression threatens. Next time, we cannot be certain that the available size of fiscal stimulus - either in the US or worldwide - will match the negative shock to demand caused by the credit crisis. Either we will already have too much debt or we will be constrained by the consequences of taking on even more debt. Or - just as in 1930 - the financial decelerator will simply be too large to be offset by any feasible fiscal measures.
