The UK's trade gap with the rest of the world widened unexpectedly in January to its largest since August 2008.Exports saw their sharpest drop in more than three years, according to the Office for National Statistics (ONS). The UK's trade gap in goods and services widened to £3.8bn, compared with £2.6bn in December. The news came as a disappointment and caused the pound to weaken, dipping 0.4% to 1.10 euros and losing 0.75% against the dollar to below $1.50.
The UK's trade gap with the rest of the world widened unexpectedly in January to its largest since August 2008.
Exports saw their sharpest drop in more than three years, according to the Office for National Statistics (ONS).
The UK's trade gap in goods and services widened to £3.8bn, compared with £2.6bn in December.
The news came as a disappointment and caused the pound to weaken, dipping 0.4% to 1.10 euros and losing 0.75% against the dollar to below $1.50.
Aer Lingus has announced plans to lay off 670 staff, including nearly a quarter of its cabin crew, as part of large-scale restructuring plans.The Irish Airline says it plans to save 97m euros (£88m, $132m) as a result of the cuts. The airline's cabin crew face 230 compulsory redundancies after their union rejected restructuring plans. Other staff, whose unions agreed with the cuts, will see 440 voluntary job losses. Earlier, Aer Lingus reported losses of 66.2m euros for 2009.
Aer Lingus has announced plans to lay off 670 staff, including nearly a quarter of its cabin crew, as part of large-scale restructuring plans.
The Irish Airline says it plans to save 97m euros (£88m, $132m) as a result of the cuts.
The airline's cabin crew face 230 compulsory redundancies after their union rejected restructuring plans.
Other staff, whose unions agreed with the cuts, will see 440 voluntary job losses.
Earlier, Aer Lingus reported losses of 66.2m euros for 2009.
Eurotunnel, the firm that manages the Channel Tunnel, made a profit of 1.4m euros ($1.9m; £1.3m) last year, despite a "poor economic environment".The 2009 net profit was a decrease on the 34m euros it made in 2008, and also came despite the knock-on impact of the fire in the tunnel in September 2008. This blaze resulted in services through the tunnel not returning to normal levels until February of last year.
Eurotunnel, the firm that manages the Channel Tunnel, made a profit of 1.4m euros ($1.9m; £1.3m) last year, despite a "poor economic environment".
The 2009 net profit was a decrease on the 34m euros it made in 2008, and also came despite the knock-on impact of the fire in the tunnel in September 2008.
This blaze resulted in services through the tunnel not returning to normal levels until February of last year.
Brussels has said it would be "extremely concerned" if the defence group EADS was prevented from fairly bidding for a major US defence deal.Its comments came after pan-European EADS and US partner Northrop Grumman abandoned a bid for a $35bn (£23bn) mid-air refuelling aircraft contract. Northrop Grumman and EADS said the terms of the Pentagon tender "clearly favour" US aerospace giant Boeing. Boeing is now widely expected to win the contract for the aircraft.
Brussels has said it would be "extremely concerned" if the defence group EADS was prevented from fairly bidding for a major US defence deal.
Its comments came after pan-European EADS and US partner Northrop Grumman abandoned a bid for a $35bn (£23bn) mid-air refuelling aircraft contract.
Northrop Grumman and EADS said the terms of the Pentagon tender "clearly favour" US aerospace giant Boeing.
Boeing is now widely expected to win the contract for the aircraft.
A professional gambler has been found guilty of running a £34m pyramid scam that targeted people on low incomes.Kevin Foster, 51, of Doddington, in Kent, was convicted of charges of dishonestly concealing a material fact and theft at Harrow Crown Court. Jurors were told he persuaded thousands of people to part with an average of £4,200 at high-pressure rallies in sports and social clubs across the UK. The judge warned Foster he faced a "substantial" jail sentence. He was cleared of one count of theft and no verdict was reached on a further charge.
A professional gambler has been found guilty of running a £34m pyramid scam that targeted people on low incomes.
Kevin Foster, 51, of Doddington, in Kent, was convicted of charges of dishonestly concealing a material fact and theft at Harrow Crown Court.
Jurors were told he persuaded thousands of people to part with an average of £4,200 at high-pressure rallies in sports and social clubs across the UK.
The judge warned Foster he faced a "substantial" jail sentence.
He was cleared of one count of theft and no verdict was reached on a further charge.
The Greek prime minister has welcomed the US response to his call for a crackdown on speculators he blames for damaging Greece's economy. George Papandreou met President Barack Obama in Washington on Tuesday to discuss his country's financial woes. "We have found a positive response from President Obama which means this issue will be on the agenda in the next G20 meeting," Papandreou told reporters outside the White House after the talks. Greece wants to see the US impose stricter regulations on hedge funds and currency traders that Athens believes aggravated their crisis.
The Greek prime minister has welcomed the US response to his call for a crackdown on speculators he blames for damaging Greece's economy.
George Papandreou met President Barack Obama in Washington on Tuesday to discuss his country's financial woes.
"We have found a positive response from President Obama which means this issue will be on the agenda in the next G20 meeting," Papandreou told reporters outside the White House after the talks.
Greece wants to see the US impose stricter regulations on hedge funds and currency traders that Athens believes aggravated their crisis.
Want to see the real consequence of smash mouth economics? Forget about Greece and take a look at Latvia. Its 25.5 per cent plunge in GDP over just the past two years (almost 20 per cent in this past year alone) is already the worst two-year drop on record. The country recently reported a 12% decline in annual wages in Q4 2009 versus Q4 2008. The IMF projects another 4 percent drop this year, and predicts that the total loss of output from peak to bottom will reach 30 percent. The magnitude of this loss of output in Latvia is more than that of the U.S. Great Depression downturn of 1929-1933. Policies and systems built for failure Mainstream economics insists that one path to full employment is via lower wages. If you want to sell more labor services, lower the price of them, namely wages. This is a classic fallacy of composition argument. What might work for one firm is unlikely to work for all firms. Wage cuts in the aggregate simply destroy aggregate spending power, unless the lost demand is made up for in other ways. But even though Latvia's external balance is improving (largely through a collapse of imports as a result of the collapse of domestic demand), the country is unable to deploy fiscal policy effectively due to the external constraints of its monetary system, which is predicated on the existence of a currency board system. True, the current account is now turning positive, but to suggest that every single country can "internally deflate" its economy via wage destruction of this magnitude to achieve this state of affairs is another fallacy of composition argument. The whole world cannot run trade surpluses, especially not if policy is designed to destroy demand via massive wage destruction. More importantly, the very structure of a currency board is wrong. It requires a nation to have sufficient foreign reserves to facilitate 100 per cent convertibility of the monetary base (reserves and cash outstanding). Under this system, the central bank stands by to guarantee this convertibility at a fixed exchange rate against the so-called anchor currency. The government is then fiscally constrained and all spending must be backed by taxation revenue or debt-issuance. Pegging one's currency, then, means that the central bank has to manage interest rates to ensure the parity is maintained and fiscal policy is hamstrung by the currency requirements (which is why organizations like the IMF love them so much; it ties governments' hands). Latvia pegs its currency at 0.71 lat per Euro and joined the ERM in 2005 with the intent of qualifying for the euro zone. It operates a system similar to Argentina in the 1990s which ultimately collapsed and led to its default in 2001 (Argentina pegged against the US dollar).
Policies and systems built for failure
Mainstream economics insists that one path to full employment is via lower wages. If you want to sell more labor services, lower the price of them, namely wages. This is a classic fallacy of composition argument. What might work for one firm is unlikely to work for all firms. Wage cuts in the aggregate simply destroy aggregate spending power, unless the lost demand is made up for in other ways.
But even though Latvia's external balance is improving (largely through a collapse of imports as a result of the collapse of domestic demand), the country is unable to deploy fiscal policy effectively due to the external constraints of its monetary system, which is predicated on the existence of a currency board system. True, the current account is now turning positive, but to suggest that every single country can "internally deflate" its economy via wage destruction of this magnitude to achieve this state of affairs is another fallacy of composition argument. The whole world cannot run trade surpluses, especially not if policy is designed to destroy demand via massive wage destruction.
More importantly, the very structure of a currency board is wrong. It requires a nation to have sufficient foreign reserves to facilitate 100 per cent convertibility of the monetary base (reserves and cash outstanding). Under this system, the central bank stands by to guarantee this convertibility at a fixed exchange rate against the so-called anchor currency. The government is then fiscally constrained and all spending must be backed by taxation revenue or debt-issuance. Pegging one's currency, then, means that the central bank has to manage interest rates to ensure the parity is maintained and fiscal policy is hamstrung by the currency requirements (which is why organizations like the IMF love them so much; it ties governments' hands). Latvia pegs its currency at 0.71 lat per Euro and joined the ERM in 2005 with the intent of qualifying for the euro zone. It operates a system similar to Argentina in the 1990s which ultimately collapsed and led to its default in 2001 (Argentina pegged against the US dollar).
China's exporters fret over labour shortage | AFP via France24
... Huada is one of thousands of companies in China's coastal exporting belt now grappling with a massive labour shortage, just one year after the economic crisis put some 20 million migrant workers out of work. <...> "Young workers are no longer prepared to accept indefinitely the appalling working conditions their parents put up with," said Geoff Crothall of the Hong Kong-based China Labour Bulletin, an advocacy group. <...> ... decades of prosperity -- along with Beijing's 586-billion-dollar, infrastructure-focused stimulus package unveiled in late 2008 -- have created more jobs in China's interior, leaving workers with more choices. <...> Some companies have even built on-site Internet cafes, table tennis rooms and basketball courts. <...> "We should gradually enable migrant workers to get the same rights that urban residents have in terms of work payment, children's education, health care, home purchase and renting, and social security," Wen [Jiabao] said. ...
"Young workers are no longer prepared to accept indefinitely the appalling working conditions their parents put up with," said Geoff Crothall of the Hong Kong-based China Labour Bulletin, an advocacy group. <...>
... decades of prosperity -- along with Beijing's 586-billion-dollar, infrastructure-focused stimulus package unveiled in late 2008 -- have created more jobs in China's interior, leaving workers with more choices. <...>
Some companies have even built on-site Internet cafes, table tennis rooms and basketball courts. <...>
"We should gradually enable migrant workers to get the same rights that urban residents have in terms of work payment, children's education, health care, home purchase and renting, and social security," Wen [Jiabao] said. ...
See also from yesterday's Salon:
Chinese factory workers cash in sweat for prosperity | OregonLive.com
China's "labour famine:" Hype and reality | China Labour Bulletin
What is not addressed in this article is the huge number of college graduates who are unable to find work in China -- and who are growing increasingly frustrated and desperate. See for example:
Paradoxes in China's job market increasingly apparent | CLB
Two recent news reports underscored paradoxes in China's economic structure, with too few people to work in construction, manufacturing, cleaning and the restaurant sector - positions typically reserved for "migrant workers". Meanwhile, college graduates face bleak employment prospects, even as the economy hums along at well above 8 percent GDP growth. Women graduates, in particular, are facing difficult employment prospects, and according to a high ranking official of the All-China Women's Federation, there are five major reasons behind it...
