Europe and the United States have announced co-ordinated action against China for breaking World Trade Organisation rules, raising fears of a damaging trade war in the depths of the global recession. The US trade representative issued a statement this afternoon criticising restrictions China has placed on exports of raw materials, to the disadvantage of American firms. Together with Europe, the US will start formal "dispute resolution consultations" at the WTO, claiming China has breached the rules of the international marketplace.
The US trade representative issued a statement this afternoon criticising restrictions China has placed on exports of raw materials, to the disadvantage of American firms. Together with Europe, the US will start formal "dispute resolution consultations" at the WTO, claiming China has breached the rules of the international marketplace.
Regulators will not be distracted from the 'radical' reforms on pay and capital requirements required at the banks despite early signs of economic recovery, Lord Turner, chairman of the Financial Services Authority (FSA), has pledged. Giving evidence before the Treasury Select Committee on Tuesday, he said: "There is a danger, because we are now seeing positive signs, that there could be some drawing back from the degree of radicalisation required. [We must] ensure we're not sitting here again in 10 to 15 years' time. We are going to make sure we are being radical enough."
Giving evidence before the Treasury Select Committee on Tuesday, he said: "There is a danger, because we are now seeing positive signs, that there could be some drawing back from the degree of radicalisation required. [We must] ensure we're not sitting here again in 10 to 15 years' time. We are going to make sure we are being radical enough."
Nearly one in six "prime" mortgages in the UK have fallen into negative equity, according to ratings agency Fitch. Households in Sunderland and Northampton are suffering most from the property crisis, it reveals. Northern Rock has the most once-prime loans now in negative equity, said Fitch, with 32% of the mortgages in its controversial "Granite" book higher in value than the homes they are secured against. The lender had specialised in offering 125% "Together mortgages" which combined a 100% home loan with a personal loan and were aimed at first-time buyers struggling to get on to the property ladder.
Northern Rock has the most once-prime loans now in negative equity, said Fitch, with 32% of the mortgages in its controversial "Granite" book higher in value than the homes they are secured against.
The lender had specialised in offering 125% "Together mortgages" which combined a 100% home loan with a personal loan and were aimed at first-time buyers struggling to get on to the property ladder.
Course, the got could change the conditions to reverse housing shortages, but that's called bucking the market (or hurting the profitability of donor companies). keep to the Fen Causeway
Protesting workers held the executive chairman of TDF, the French television broadcast operator, hostage today in the latest case of bossnapping in France. About 600 employees invaded the group's headquarters outside Paris to demand the withdrawal of a redundancy plan. Patrick Babin, the executive chairman, was detained in his office, before being released as the striking staff joined a protest march. "We're asking him to scrap his restructuring plan," said Bruno Rabardel, a representative of the Confédération générale du Travail union.
About 600 employees invaded the group's headquarters outside Paris to demand the withdrawal of a redundancy plan.
Patrick Babin, the executive chairman, was detained in his office, before being released as the striking staff joined a protest march.
"We're asking him to scrap his restructuring plan," said Bruno Rabardel, a representative of the Confédération générale du Travail union.
EUOBSERVER / BRUSSELS - Trade representatives from the European Union and Australia say they will push for further progress on the Doha round of multilateral trade talks at a meeting in Paris this week. "I'm going to Paris with the very strong conviction that we now need to move forward speedily and we need to set a timetable [for the talks]," said European trade commissioner Catherine Ashton following a meeting in Brussels on Tuesday (23 June) with Australian Trade Minister Simon Crean. Trade ministers from around the World will meet on the sidelines of an annual ministerial meeting of the Organisation for Economic Co-operation and Development in Paris later this week (24-25 June) to assess the political willingness to officially resume the Doha talks that stalled in July 2008. Several non-OECD members have also been invited to the meeting including India, Brazil, Chile, China, Indonesia, Russia, and South Africa, whose agreement will prove vital to securing a multilateral deal.
"I'm going to Paris with the very strong conviction that we now need to move forward speedily and we need to set a timetable [for the talks]," said European trade commissioner Catherine Ashton following a meeting in Brussels on Tuesday (23 June) with Australian Trade Minister Simon Crean.
Trade ministers from around the World will meet on the sidelines of an annual ministerial meeting of the Organisation for Economic Co-operation and Development in Paris later this week (24-25 June) to assess the political willingness to officially resume the Doha talks that stalled in July 2008.
Several non-OECD members have also been invited to the meeting including India, Brazil, Chile, China, Indonesia, Russia, and South Africa, whose agreement will prove vital to securing a multilateral deal.
European nations need to find a "credible exit strategy" for their public finances as the aid shelled out to shore up banks could reach 16.5 percent of GDP, an EU report warned Tuesday. In its annual report on public finances, the European Commission estimated the direct fiscal costs of the current crisis in the EU anywhere in a broad band from 2.75 percent to 16.5 percent of gross domestic product (GDP).
In its annual report on public finances, the European Commission estimated the direct fiscal costs of the current crisis in the EU anywhere in a broad band from 2.75 percent to 16.5 percent of gross domestic product (GDP).
* Unite 'appalled' by size of pay package* Shareholders say price target could encourage risk-taking* City institutions believe RBS should reconsider dealA pay deal for Stephen Hester, the Royal Bank of Scotland's chief executive, which could reach £15m provoked anger from unions, shareholders and politicians last night as the state-controlled bank reignited the public furore over boardroom pay.RBS was accused of missing an opportunity to set an example and put a lid on bankers' pay following the £20bn taxpayer bailout of the Edinburgh-based bank in which the government has a 70% stake.City institutional investors believe the bank should reconsider Hester's pay package which comprises cash, shares, options, credit notes and debt and will pay out its maximum amount in three years if the taxpayer makes an estimated £8bn profit on its shareholding in the bank.
* Shareholders say price target could encourage risk-taking
* City institutions believe RBS should reconsider deal
A pay deal for Stephen Hester, the Royal Bank of Scotland's chief executive, which could reach £15m provoked anger from unions, shareholders and politicians last night as the state-controlled bank reignited the public furore over boardroom pay.
RBS was accused of missing an opportunity to set an example and put a lid on bankers' pay following the £20bn taxpayer bailout of the Edinburgh-based bank in which the government has a 70% stake.
City institutional investors believe the bank should reconsider Hester's pay package which comprises cash, shares, options, credit notes and debt and will pay out its maximum amount in three years if the taxpayer makes an estimated £8bn profit on its shareholding in the bank.
Government should not care, but do a very simple thing: have a high enough marginal tax rate to make any kind of huge package mostly useless. In the long run, we're all dead. John Maynard Keynes
Boeing delays maiden Dreamliner flight Boeing has been forced to postpone the first flight of its troubled 787 Dreamliner, its flagship new aircraft development programme, after discovering a weakness in the structure of the jet. The US aircraft maker, which was already running nearly two years behind schedule, had been due to make the maiden flight by June 30. (...) The problems at Boeing are a stark reminder of the daunting complexity of developing new generation large commercial aircraft and follow more than two years of delays suffered previously by Airbus in bringing its A380 superjumbo into commercial service. Boeing is greatly increasing the use of lighter materials in the 787, including the first all-composite airframe, and has tried to streamline manufacturing and assembly processes and to outsource much more of the engineering and manufacturing to suppliers around the globe. For the first time the wings of a Boeing aircraft are being made in Japan, which is accounting for 35 per cent of the airframe in total, with other key outside suppliers in Italy and the US. Boeing said it was engaged with both Mitsubishi and Fuji Heavy Industries in engineering the necessary reinforcement parts. The unexpected stresses in the structure had been found in 36 places, 18 on each side of the aircraft, at the join of the wing to the body, each in areas of one to two square inches.
Boeing has been forced to postpone the first flight of its troubled 787 Dreamliner, its flagship new aircraft development programme, after discovering a weakness in the structure of the jet.
The US aircraft maker, which was already running nearly two years behind schedule, had been due to make the maiden flight by June 30.
(...)
The problems at Boeing are a stark reminder of the daunting complexity of developing new generation large commercial aircraft and follow more than two years of delays suffered previously by Airbus in bringing its A380 superjumbo into commercial service.
Boeing is greatly increasing the use of lighter materials in the 787, including the first all-composite airframe, and has tried to streamline manufacturing and assembly processes and to outsource much more of the engineering and manufacturing to suppliers around the globe.
For the first time the wings of a Boeing aircraft are being made in Japan, which is accounting for 35 per cent of the airframe in total, with other key outside suppliers in Italy and the US. Boeing said it was engaged with both Mitsubishi and Fuji Heavy Industries in engineering the necessary reinforcement parts.
The unexpected stresses in the structure had been found in 36 places, 18 on each side of the aircraft, at the join of the wing to the body, each in areas of one to two square inches.
The A380 delays were a sign that Airbus's multinational structure and management, laden with heavy state interference, did not work. This time, of course, it is just because of the complexity of designing aircraft.
Europe. Is. So. Doomed. In the long run, we're all dead. John Maynard Keynes
June 24 (Bloomberg) -- Japan's export slump deepened in May, casting doubt on the nation's growth prospects as the economy struggles to emerge from its worst postwar recession. Shipments abroad dropped 40.9 percent from a year earlier, more than April's 39.1 percent decline, the Finance Ministry said today in Tokyo. The median estimate of economists surveyed was for a 39.3 percent decrease. From a month earlier, exports fell 0.3 percent, the first deterioration since February. Declines in shipments to Asia accelerated for the first time since January, damping hopes that demand from the region will spur a recovery in the world's second-largest economy. A worldwide stock market rally stalled this month on concern that the global recession will deepen. "Final demand just isn't picking up and it's still hard to expect a very strong economic recovery," said Azusa Kato, an economist at BNP Paribas in Tokyo. Kato said the economy will "barely expand" in 2010 once the effect of Japan's own economic stimulus measures fades.
Shipments abroad dropped 40.9 percent from a year earlier, more than April's 39.1 percent decline, the Finance Ministry said today in Tokyo. The median estimate of economists surveyed was for a 39.3 percent decrease. From a month earlier, exports fell 0.3 percent, the first deterioration since February.
Declines in shipments to Asia accelerated for the first time since January, damping hopes that demand from the region will spur a recovery in the world's second-largest economy. A worldwide stock market rally stalled this month on concern that the global recession will deepen.
"Final demand just isn't picking up and it's still hard to expect a very strong economic recovery," said Azusa Kato, an economist at BNP Paribas in Tokyo. Kato said the economy will "barely expand" in 2010 once the effect of Japan's own economic stimulus measures fades.
The FT reports that the OECD warns on pension crisis:
Strains in pensions systems, in both private and public provision, threaten to turn the financial crisis of the past two years into a social crisis lasting for decades, the Organisation for Economic Co-operation and Development warned on Tuesday. In its annual analysis of the health of pensions systems globally, the Paris-based organisation found private pension plans lost 23 per cent of their value last year, while higher unemployment "leaves little room for more generous public pensions. Angel Gurría, the OECD secretary-general said: "Reforming pension systems now to make them both affordable and strong enough to provide protection against market swings will save governments a lot of financial and political pain in the future".
There's no rule that says that public pensions have to be financed only on wage-based contributions only. Thye could be financed by taxes, which can be progressive.
All of these crises (like that of public finances) exist only because of the highly consistent decision by all writers to not even consider higher taxes.
As to private pensions, why is it a problem? Why should governments care? People were allowed to be free and make their own pension arrangements without government interference, why should they be bailed out or helped in any way? They made their decisions and have to be responsibile for them, no?
Or is this just about giving more tax breaks and subsidies to the pensions funds management industry?
Whiners. In the long run, we're all dead. John Maynard Keynes
For public pension funds and public funded medical care a Tobin Tax on financial transactions dedicated to these purposes could simultaneously help put them on a sounder footing and provide a much needed check on purely speculative financial transactions. The extent to which finance has been allowed to become a parasitic public casino that primarily serves only the financiers is another under reported scandal.
But as to private pensions and corporate pensions, the proper remedy is to make all wealth derived from corporations and "wealth management" firms, including gifts, trusts, etc. subject to "claw back" provisions before the beneficiaries, excluding corporate management, take a hit to their retirement funds. At a minimum, these employees should be entitled to the cash value of their contributions and the contributions made on their behalf. As the Dutch said while fighting the Spanish: "It is not necessary to have hope in order to persevere."
At the heart of the financial industry are highly leveraged businesses. Their central activity is creating and trading assets of uncertain value, while their liabilities are, as we have been reminded, guaranteed by the state. This is a licence to gamble with taxpayers' money. The mystery is that crises erupt so rarely.
Such a crisis is not only the result of a rational response to incentives. Folly and ignorance play a part. Nor do I believe that bubbles and crises can be eliminated from capitalism. Yet it is hard to believe that the risks being run by huge institutions had nothing to do with incentives. The unpleasant truth is that, today, the incentive to behave in this risky way is, if anything, even bigger than it was before the crisis. Regulatory reform cannot end with incentives. But it has to start from incentives. A business that is too big to fail cannot be run in the interests of shareholders, since it is no longer part of the market. Either it must be possible to close it down or it has to be run in a different way. It is as simple - and brutal - as that.
Regulatory reform cannot end with incentives. But it has to start from incentives. A business that is too big to fail cannot be run in the interests of shareholders, since it is no longer part of the market. Either it must be possible to close it down or it has to be run in a different way. It is as simple - and brutal - as that.
Can't argue with that! Earth provides enough to satisfy every man's need, but not every man's greed. Gandhi
