FT.com / Media - Regulator reports on BSkyB-News Corp deal

LONDON, Dec 31 - A report examining whether News Corp's proposed $12bn buyout of BSkyB would give too much media power to Rupert Murdoch was sent to the British government on Friday, without being made public.

News Corp, led by Mr Murdoch, wants to buy the 61 per cent of the British satellite broadcaster it does not already own for £7.8bn to consolidate a business it helped build.

However, rivals have raised concerns that the merger would give Mr Murdoch too much influence over public opinion.

The government asked Britain's communications regulator Ofcom to examine the deal and to make a recommendation as to whether it should be referred for further inspection by Britain's Competition Commission.

The fact is that what we're experiencing right now is a top-down disaster. -Paul Krugman

China-Russia oil pipeline opens - Business - Al Jazeera English

Russia has begun oil shipments to China via an East Siberian link, with supplies delivered in January expected to hit 1.3 million tonnes, Russian officials say.

Igor Dyomin, a spokesman for Russian oil pipeline monopoly Transneft, confirmed on Saturday that the supplies had begun.

Russia, the world's biggest crude oil exporter, has concentrated most of its 50,000km-long pipeline network in West Siberia, but the new Eastern Siberia-Pacific Ocean (ESPO) pipeline gives it access to the world's largest energy consumers' market.

According to the final schedule for crude oil exports and transit, in January-March 2011, Russia will ship 3.68 million tonnes of oil to China via ESPO.

The fact is that what we're experiencing right now is a top-down disaster. -Paul Krugman

India launches shariah stock index | beyondbrics | News and views on emerging markets from the Financial Times - FT.com

The Bombay Stock Exchange has launched India's first index of companies compliant with Islamic law, or shariah, in an effort to bring more of the country's 175m Muslims into mainstream finance, and to attract investment from foreign shariah-abiding funds.

Shariah finance has become a trillion-dollar global business, most notably in the Gulf. But in spite of India's sizeable Muslim population, it has not yet taken off in south Asia. The creators of the new index - called the BSE Tasis Shariah Index and launched on Monday - hope to change that.

The index is made up of the 50 biggest Indian companies whose operations are deemed to be consistent with shariah - meaning that they don't derive significant profit from interest payments, or sell products or services such as tobacco, alcohol or weapons, which are considered in the Islamic faith as sinful.

The fact is that what we're experiencing right now is a top-down disaster. -Paul Krugman

Welfare bill soars as coalition counts cost of austerity drive | Politics | The Guardian

Rising unemployment will cost the government £1.5bn more than expected in welfare benefits, according to official forecasts that reveal the hidden cost of the coalition's austerity drive.

As big increases in VAT are due to bite from Tuesday, analysis from the Office for Budget Responsibility shows slowing economic growth will make it harder to reduce the deficit by forcing more people to seek state support.

The Treasury watchdog calculates the government will have to pay out £700m more in unemployment benefit than previously forecast. Similarly, a higher number claiming jobseeker's allowance as well as falling into lower wage brackets will see the government needing to pay out another £700m more in housing assistance over the next four years.

"The future is already here -- it's just not very evenly distributed" William Gibson

ELPAÍS.com in English: Bank of Spain draws battle lines in ongoing war of interest rates

After already issuing one warning, which was ignored by the banking sector, Central Bank officials are demanding that savings and commercial banks- those that have received public money or plan to receive it- stop their "aggressive campaigns" to attract customers to open accounts.

The Central Bank, which is headed by Miguel Ángel Fernández Ordóñez, wants to prevent a banking war that could accelerate a collapse of the institutions that offer high interest rates. Although such campaigns can help banks solve their short-term liquidity problems, it forces them into an impossible situation where they would have to pay off the high interest rates they are offering to customers after one year. Currently, some banks are offering up to five percent on some accounts when Treasury notes are listed at 3.5 percent and interest in the interbank market doesn't go beyond 1.5 percent.

Through this warning, the Bank of Spain has effectively put a halt to free market competition by clipping the wings of those institutions that have received public money. The nation's larger banks and some savings banks (popularly known as cajas in Spanish) have lodged complaints against the regulatory body because they feel that the government has "reined in" their rights to conduct business as entitled under European Commission rules.

This "deposit-taking war" has been going on for 8 months...

Of all the ways of organizing banking, the worst is the one we have today — Mervyn King, 25 October 2010

Very interesting first roundup of the year from Eurointelligence: A year of truth for the eurozone

In an editorial, [Frankfurter Allgemeine] noted that Germany could count on Estonia for support of a northern European monetary union - without the countries of the Mediterranean.

So, does Germany really want to split the Eurozone into an exporters' union and an importers' union? That would nullify the advantages of Euro membership for Germany.

Trolling from the FAZ editorial pages aside, there's more:

Nobody, of course, has switched any substantive positions. A good example was the comment from Wolfgang Schäuble in a German newspaper interview:  "The higher yield level expressed in so-called spreads is both incentive and sanction... That's why this mechanism should not be put out of work through a collectivisation of the yield level, including in the form of euro bonds."

But the most interesting bit is

Is Merkel ready to drop Axel Weber for the ECB job?

Frankfurter Allgemeine has an interesting if speculative article about why Merkel might drop Weber in the race for the ECB presidency. The theory goes like this: Merkel is getting closer to Sarkozy on the euro because Germany wants the ECB to help out where governments are constrained for political reasons  - through bond purchases, continuation of flexible lending policies, and low interest rates. For example, Germany opposes an extension of the EFSF's size and mandate, while the ECB wants governments to solve the problem. Weber might not be the most conducive candidate for a compliant ECB. The paper quotes an official close to Merkel as saying that Germany was no longer pushing for a German central banker at the top of the ECB, but for the most qualified central banker. The authors of the Herdentrieb blog predicted that Klaus Regling would get the job.

Who is Klaus Regling? Would we like him as a Central Banker?

Of all the ways of organizing banking, the worst is the one we have today — Mervyn King, 25 October 2010

Nothing like a hopeless recession to get people to undust the past.

Last December 28, Die Zeit published the following piece about a topic dear to our hearts...

Historisches Experiment: Das Wunder von Wörgl | Wissen | ZEIT ONLINE		Historical experiment: the wonder from Wörgl
Wie bekommt man das Geld zum Zirkulieren und in hoffnungsloser Rezession die Wirtschaft in Schwung? Ein österreichischer Bürgermeister wagte 1932 ein erstaunliches Experiment		How does one get money to circulate and the Economy going in a hopeless recession? An Austrian mayor carried out an astonishing experiment in 1932.

Of all the ways of organizing banking, the worst is the one we have today — Mervyn King, 25 October 2010

Bank Of America Has A Team Of 15 People Feverishly Preparing For The Wikileaks Torpedo

We already know that one of their methods was to buy up abusive domain names like brianmoynihansucks.com, and that they set up a so-called "SWAT team" to prepare their defenses. 

And this is how they're preparing for the battle:

• Chief risk officer Bruce Thompson is heading up a team of 15 to 20 of the bank's top dogs that's undertaking a far-reaching internal probe of thousands of documents.
• They've hired consulting firm Booz Allen Hamilton to aid the investigation, and have obviously spoken to several law firms about what might happen if Wikileaks docs reveal private information about their clients.
• CEO Brian Moynihan gets regular updates on the team's progress.
• They're looking for missing computers  because Assange has previously said he had 5 gigabytes of information (apparently enough to hold more than 200,000 pages of text) on BofA on a hard drive - one of the main reasons the public believes they are the target. So far they've found no evidence that Assange does have a hard drive.
• The bank thinks that what is more likely is that if anything, Wikileaks has documents on paper and discs it gave to the SEC during congressional investigation into BofA's acquisition of Merrill Lynch. They're also considering documents that could reveal embarrassing details about the Countrywide fiasco.

Of all the ways of organizing banking, the worst is the one we have today — Mervyn King, 25 October 2010