*Lunatic*, n. One whose delusions are out of fashion.
Both the eurozone and the European Union saw growth in the third quarter. According to Eurostat, the eurozone posted growth of 0.4% and the EU grew by 0.2%. The British and Spanish economies remain in the red.
AFP - French auto maker PSA Peugeot Citroen said on Thursday it needed to cut 6,000 jobs in France between now and 2012 in order to boost productivity.Peugeot chairman Philippe Varin, outlining 2010-2012 performance plan for the group, said the reductions would come through the non-replacement of workers leaving the company voluntarily.
AFP - French auto maker PSA Peugeot Citroen said on Thursday it needed to cut 6,000 jobs in France between now and 2012 in order to boost productivity.
Peugeot chairman Philippe Varin, outlining 2010-2012 performance plan for the group, said the reductions would come through the non-replacement of workers leaving the company voluntarily.
Porsche revealed on Thursday a €4.4bn pre-tax loss in its past fiscal year. The sports carmaker had to swallow large writedowns on Volkswagen shares and options.It said the loss compared to a €8.6bn profit before tax in the year before, when it could reap billions in paper gains from option bets with VW shares.
Porsche revealed on Thursday a €4.4bn pre-tax loss in its past fiscal year. The sports carmaker had to swallow large writedowns on Volkswagen shares and options.
It said the loss compared to a €8.6bn profit before tax in the year before, when it could reap billions in paper gains from option bets with VW shares.
Consider, for a moment, a tale of two countries. Both have suffered a severe recession and lost jobs as a result -- but not on the same scale. In Country A, employment has fallen more than 5 percent, and the unemployment rate has more than doubled. In Country B, employment has fallen only half a percent, and unemployment is only slightly higher than it was before the crisis. Don't you think Country A might have something to learn from Country B? This story isn't hypothetical. Country A is the United States, where stocks are up, G.D.P. is rising, but the terrible employment situation just keeps getting worse. Country B is Germany, which took a hit to its G.D.P. when world trade collapsed, but has been remarkably successful at avoiding mass job losses. Germany's jobs miracle hasn't received much attention in this country -- but it's real, it's striking, and it raises serious questions about whether the U.S. government is doing the right things to fight unemployment. ...
Don't you think Country A might have something to learn from Country B?
This story isn't hypothetical. Country A is the United States, where stocks are up, G.D.P. is rising, but the terrible employment situation just keeps getting worse. Country B is Germany, which took a hit to its G.D.P. when world trade collapsed, but has been remarkably successful at avoiding mass job losses. Germany's jobs miracle hasn't received much attention in this country -- but it's real, it's striking, and it raises serious questions about whether the U.S. government is doing the right things to fight unemployment. ...
... it raises serious questions about whether the U.S. government is doing the right things to fight unemployment. ...
Don't look now, Krugsy old boy (I get to call him that. I'm special.) but the`government doesn't give a rat's ass about the unemployment rate in the general population, only about their own. Wake up, grow up Krugsy. In the end, might makes right. Nothing has changed since the caveman.
British Airways last night confirmed that it will merge with the Spanish flag carrier Iberia in a $7bn (£4.2bn) deal, creating the world's third biggest airline. The announcement comes after a day when the boards of both companies were locked in separate meetings, combing through the fine details of the plans which have been under discussion for nearly 18 months.
British Airways' Spanish merger partner Iberia today said losses in the first nine months of the year more than tripled to €181.9m (£162.4m). The group is suffering the same industry headaches that left BA with its first ever interim loss this year, with passengers flying less amid the recession.
British Airways' Spanish merger partner Iberia today said losses in the first nine months of the year more than tripled to €181.9m (£162.4m).
The group is suffering the same industry headaches that left BA with its first ever interim loss this year, with passengers flying less amid the recession.
Europe knows all about how tough Gazprom can be at the negotiating table. Now Gazprom, the bare-knuckled king of natural gas, is out to make its mark in America. Just how tough is Gazprom? As the world's biggest supplier of natural gas, the Russian company has a reputation for hard-nosed bargaining. So when John Hattenberger, chief of the company's new US operation, hired George Thorogood and The Destroyers to play at a party marking the opening of Gazprom's Houston office, he insisted Thorogood leave his Epiphone guitar after the show. "That was clause 19 of the contract," Hattenberger jokes. Today the autographed instrument hangs above Gazprom's trading floor. That's Gazprom with a sense of humor. But more often, its negotiating style is no laughing matter. In January, Gazprom slowed gas deliveries to Ukraine in a price dispute, leaving customers further down the pipeline in Central Europe shivering in the winter cold-the third time in three years Gazprom has taken similar steps.
Europe knows all about how tough Gazprom can be at the negotiating table. Now Gazprom, the bare-knuckled king of natural gas, is out to make its mark in America.
Just how tough is Gazprom? As the world's biggest supplier of natural gas, the Russian company has a reputation for hard-nosed bargaining. So when John Hattenberger, chief of the company's new US operation, hired George Thorogood and The Destroyers to play at a party marking the opening of Gazprom's Houston office, he insisted Thorogood leave his Epiphone guitar after the show. "That was clause 19 of the contract," Hattenberger jokes. Today the autographed instrument hangs above Gazprom's trading floor.
That's Gazprom with a sense of humor. But more often, its negotiating style is no laughing matter. In January, Gazprom slowed gas deliveries to Ukraine in a price dispute, leaving customers further down the pipeline in Central Europe shivering in the winter cold-the third time in three years Gazprom has taken similar steps.
(I don't recall shivering in winter cold last winter, not to mention three winters in a row.) *Lunatic*, n. One whose delusions are out of fashion.
The American dollar is in the midst of a large fall in its value, or depreciation, as measured against other major currencies. The decline has been steady since 2002 and our currency is down about 35 percent from that peak. After strengthening slightly more than 10 percent during the global financial crisis of the past 18 months, the dollar is again falling back toward its pre-crisis lows, representing its weakest international value since 1967. But there is a definite possibility that the dollar could soon decline further or faster. At the level of general economic strategy, the American government has responded to a financial sector crisis with an expansionary fiscal policy, and the Federal Reserve is implementing loose monetary policy. Andrew Haldane, responsible for financial stability at the Bank of England, puts it this way: "For the authorities, [excessive risk-taking by the financial sector] poses a dilemma. Ex-ante, they may well say "never again." But the ex-post costs of crisis mean such a statement lacks credibility. Knowing this, the rational response by market participants is to double their bets. This adds to the cost of future crises. And the larger these costs, the lower the credibility of "never again" announcements. This is a doom loop." (link to the paper)
But there is a definite possibility that the dollar could soon decline further or faster.
At the level of general economic strategy, the American government has responded to a financial sector crisis with an expansionary fiscal policy, and the Federal Reserve is implementing loose monetary policy. Andrew Haldane, responsible for financial stability at the Bank of England, puts it this way:
"For the authorities, [excessive risk-taking by the financial sector] poses a dilemma. Ex-ante, they may well say "never again." But the ex-post costs of crisis mean such a statement lacks credibility. Knowing this, the rational response by market participants is to double their bets. This adds to the cost of future crises. And the larger these costs, the lower the credibility of "never again" announcements. This is a doom loop." (link to the paper)
Both Mervyn King and Andrew Haldane of the Bank of England have now spoken cogently, publicly and forcefully about current financial problems. But will it matter? Larry, Ben and Tim don't really seem to want the rules of finance to change very much. Unfortunately, problems with the regulation and structure of finance are only part of the problem, to continue from the Dollar Doom Loop article:
In addition to a financial crisis, we also have a large current account deficit, meaning that we buy more from the world than we sell. The deficit was $100 billion in the latest available (second quarter) data, which is around 3 percent of gross domestic product, and we finance that with capital inflows from abroad. (The current account deficit is down from around 6 percent, but two-thirds of the decline is due to the lower price of oil). In the past, many of those inflows have been private investments of various kinds, but as investors around the world question whether United States government debt, and its dollars, are really worth the paper, it is increasingly difficult for us to finance our deficit with the outside world. What does this mean for the dollar? Treasury Secretary Timothy F. Geithner continues to repeat that a strong dollar is "very important" for the American economy, but United States fiscal and monetary policy pushes toward depreciation. To bail out our banks, we need cheap money, and this implies some inflation. To finance our current account deficit, investors need to think they are buying inexpensive assets from us. Everything points to a cheaper dollar. (The same thing is happening in Britain, but the Bank of England is increasingly explicit about this point and the unsavory broader situation.) A "hard landing" scenario for the dollar could be painful.
In the past, many of those inflows have been private investments of various kinds, but as investors around the world question whether United States government debt, and its dollars, are really worth the paper, it is increasingly difficult for us to finance our deficit with the outside world.
What does this mean for the dollar?
Treasury Secretary Timothy F. Geithner continues to repeat that a strong dollar is "very important" for the American economy, but United States fiscal and monetary policy pushes toward depreciation. To bail out our banks, we need cheap money, and this implies some inflation. To finance our current account deficit, investors need to think they are buying inexpensive assets from us. Everything points to a cheaper dollar. (The same thing is happening in Britain, but the Bank of England is increasingly explicit about this point and the unsavory broader situation.)
A "hard landing" scenario for the dollar could be painful.
The 1980s classic, Stephen Marris's "Deficits and the Dollar: The World Economy at Risk," stresses that a rapidly falling dollar would push up United States inflation, resulting in higher interest rates and a deep recession (pp. lx-lxi). Writing in the latest edition of Foreign Affairs, Fred Bergsten emphasizes that such outcomes are still possible today. A weakening dollar will cause inflation fears, so yields on long-term government bonds will rise to compensate investors for inflation, and we will need to pay more and more to finance our large debts. The idea that the American dollar might follow emerging markets such as Russia in 1998 and Argentina in 2002, or Britain in the 1970s -- and so depreciate by 50 percent or more in a relatively short time -- is certainly implausible now. But such a "doom scenario" is not unrealistic in the future without change.The idea that the American dollar might follow emerging markets such as Russia in 1998 and Argentina in 2002, or Britain in the 1970s -- and so depreciate by 50 percent or more in a relatively short time -- is certainly implausible now. But such a "doom scenario" is not unrealistic in the future without change.
The idea that the American dollar might follow emerging markets such as Russia in 1998 and Argentina in 2002, or Britain in the 1970s -- and so depreciate by 50 percent or more in a relatively short time -- is certainly implausible now. But such a "doom scenario" is not unrealistic in the future without change.The idea that the American dollar might follow emerging markets such as Russia in 1998 and Argentina in 2002, or Britain in the 1970s -- and so depreciate by 50 percent or more in a relatively short time -- is certainly implausible now. But such a "doom scenario" is not unrealistic in the future without change.
Senator Byron Dorgan has some harsh words for the too big to fails: It's one of the most frustrating things. We essentially have had modern-day bank robbers -- except that they wore gray suits and not masks -- and there's been no accountability for it ... Every day we see energy speculators, war profiteers, managed health-care providers, media propagandists, and/or financiers given some unfair advantage over the average consumers and taxpayers, and the cumulative effect of the American people watching selfishness prevail over the public interest has been an undermining of the public's trust in government. This "anything goes" approach to capitalism has injured the very economy we have aspired to create. I'm a big fan of the free-market system...This is not about a liberal or conservative philosophy. It is about making sure our economy and the free-market system work for everybody... There's no question the system is rigged against the little guy. The bigger interests have a lot more information. They jerry-rig the system so that they always win. Dorgan said 3 things are needed to fix the financial system: One is to separate investment banks and FDIC-insured banks. Second, prohibit FDIC-insured banks from dealing in risky financial instruments on their own proprietary accounts... And third, abolish "too big to fail." If you're too big to fail, you're too big. Too big to fail is what I call no-fault capitalism. Senator Dorgan was one of eight senators who stood up to oppose the repeal of the Glass-Steagall act in 1999, and said at the time: I think we will in 10 years' time look back and say we should not have done this.
It's one of the most frustrating things. We essentially have had modern-day bank robbers -- except that they wore gray suits and not masks -- and there's been no accountability for it ... Every day we see energy speculators, war profiteers, managed health-care providers, media propagandists, and/or financiers given some unfair advantage over the average consumers and taxpayers, and the cumulative effect of the American people watching selfishness prevail over the public interest has been an undermining of the public's trust in government. This "anything goes" approach to capitalism has injured the very economy we have aspired to create. I'm a big fan of the free-market system...This is not about a liberal or conservative philosophy. It is about making sure our economy and the free-market system work for everybody... There's no question the system is rigged against the little guy. The bigger interests have a lot more information. They jerry-rig the system so that they always win.
This "anything goes" approach to capitalism has injured the very economy we have aspired to create.
I'm a big fan of the free-market system...This is not about a liberal or conservative philosophy. It is about making sure our economy and the free-market system work for everybody... There's no question the system is rigged against the little guy. The bigger interests have a lot more information. They jerry-rig the system so that they always win.
Dorgan said 3 things are needed to fix the financial system:
One is to separate investment banks and FDIC-insured banks. Second, prohibit FDIC-insured banks from dealing in risky financial instruments on their own proprietary accounts... And third, abolish "too big to fail." If you're too big to fail, you're too big. Too big to fail is what I call no-fault capitalism.
Senator Dorgan was one of eight senators who stood up to oppose the repeal of the Glass-Steagall act in 1999, and said at the time:
I think we will in 10 years' time look back and say we should not have done this.
