The great interest rate ripp off part 2

[interestrateripoff]

Bankers, politicians and the people blamed for credit crisis

 

Stephen Foley: Wall Street's recklessness and specific frauds to be detailed today in report on US crash.

 

• Bank watchdogs are damaging recovery, warns Barclays chief
  
• Public don't yet trust Balls and Miliband on the economy
  
• Sales figures slow after VAT rise
  
• BSkyB profits leap by 26% to £520m
  
• Medvedev: Russia is open for business
  
• App sales worth $15bn in 2011, say analysts
  
• Barclays to axe 1,000 jobs after FSA fines it £1.1m
  

 

David Prosser: China and India are the hot tickets as the East rises

 

 

Davos Outlook Davos may be full of power-brokers but here, like everywhere else on the planet, there is a hierarchy. And this year, that hierarchy has changed: not only are the Chinese and the Indians here in force, but it is their delegations to whom everyone wants to talk.

 

 

• David Prosser: Turning inwards won't benefit any of us
  
• David Prosser: Why inequality has moved up the agenda
  
• James Moore: Is Mr Osborne trying to tip us off a cliff with his deficit shock therapy?
  
• James Moore: Sherborne must now put up or shut up
  
• James Moore: Should the FSA police financial products?
  

 

Tony Wray: Open the floodgates: set Britain's water free

 

The Business Interview: Deregulation is the answer to the water industry's challenges, Severn Trent's chief executive tells Sarah Arnott

 

 

• Google: The search engine that lost its way
  
• Secretive trader prepares to open up
  
• The Business on: Robert Schofield, Chief executive, Premier Foods
  
• Down boy! His Master's Voice wavers
  
• Where's the rest of the oil?
  

[interestrateripoff]

Rich rewards needed to keep bank talent, MPs told

 

LONDON (Reuters) - Paying big bonuses at state-backed lenders such as Lloyds is in taxpayers' interest because of the need to keep top talent, the head of the body managing the 67 billion pound bank stakes said.

Continue Reading

 

 

 

Bank officials argue for banks to raise equity

 

LONDON (Reuters) - Banks should boost the amount of equity they hold as a buffer against financial problems beyond levels set out under new international standards, Bank of England officials said in a discussion paper published on Thursday.

6:11pm GMT

 

Drugmakers see pain from reform, price pressures

 

LONDON/NEW YORK (Reuters) - Four large U.S. and European drugmakers unveiled cautious 2011 forecasts, as higher costs from U.S. healthcare reform will further hurt an industry grappling with patent expirations and pressure to curb prices.

7:13pm GMT

 

Sarkozy says he, Merkel will never abandon euro

 

DAVOS, Switzerland (Reuters) - French President Nicolas Sarkozy passionately defended the euro against sceptics at the World Economic Forum on Thursday, saying he and German Chancellor Angela Merkel would never let the currency fail.

7:51pm GMT

 

Investment banks escape action on fees

 

LONDON (Reuters) - Investment banks escaped action to force down the fees they charge on Thursday when the Office of Fair Trading left it up to fund-raising companies and their shareholders to kickstart competition.

4:43pm GMT

 

U.S. manufacturing profits suggest stronger economy

 

NEW YORK/CHICAGO (Reuters) - U.S. manufacturing companies posted higher-than-expected results, as sharply improved margins boosted profits amid strong industrial demand and growth in emerging markets.

8:04pm GMT

 

Euro up after S&P Japan rating cut, ECB warning

 

NEW YORK (Reuters) - The euro hit two-month highs on Thursday against the U.S. dollar and yen after a credit rating downgrade for debt-ridden Japan and more hawkish policy talk in Europe, while global share prices edged higher.

5:02pm GMT

 

New Irish government can't renege on bailout deal - ECB

 

DUBLIN (Reuters) - A new Irish government will have to honour the country's obligations under an 85 billion euro EU/IMF bailout deal agreed last year, ECB policymaker Lorenzo Bini Smaghi said in an interview broadcast on Thursday.

7:44pm GMT

 

U.S., Japan must spell out plans to cut debt - IMF

 

WASHINGTON (Reuters) - The United States and Japan urgently need to spell out plans for cutting their budget deficits before financial markets turn on them and force borrowing costs higher, the IMF warned on Thursday.

G20 7:06pm GMT

 

Vodafone pulls FTSE lower, offsets insurer gains

 

LONDON (Reuters) - The FTSE 100 share index closed slightly lower on Thursday, after a dip in index heavyweight Vodafone , dented by weak results from AT&T, offset a surge in insurers following positive broker comment.

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The FCIC Report: Yet Another Whitewash

 

Well, it's out.

The "long-awaited" FCIC report has been published, and counts 662 pages.

Our task was first to determine what happened and how it happened so that we could understand why it happened. Here we present our conclusions.

And here the FCIC fails. But we'll get to that.

• We conclude this financial crisis was avoidable. The crisis was the result of human action and inaction, not of Mother Nature or computer models gone haywire. The captains of finance and the public stewards of our financial system ignored warnings and failed to question, understand, and manage evolving risks within a system essential to the well-being of the American public.

No. The financial crisis was avoidable, but it was not about the ignoring of warnings by captains of finance. One does not sell "protection" in the form of a credit default swap (CDS) without any capital behind it by accident. That is done with intent - the intent to collect a premium and never pay.

The buyer of such a CDS has one of two purposes. He either intends to conceal a loss that he would otherwise have to mark on his books, or he intends to hold up the taxpayer at a later date when the seller cannot pay. His action is not undertaken due to "inattention" either.

Despite the expressed view of many on Wall Street and in Washington that the crisis could not have been foreseen or avoided, there were warning signs.

The crisis was not only mathematically certain to occur it was foreseen and known to be occurring by the very firms that nearly collapsed. This is now a matter of public record in the form of testimony under oath by Citibank's former Chief Underwriter. Lehman's insolvency was known by Citibank and others weeks before it occurred, as has been disclosed by the bankruptcy investigation. Both industry and government regulators intentionally concealed these facts from the public. It is no longer speculation that "they knew", it is now a documented fact.

The prime example is the Federal Reserve’s pivotal failure to stem the flow of toxic mortgages, which it could have done by setting prudent mortgage-lending standards. The Federal Reserve was the one entity empowered to do so and it did not.

The Federal Reserve, by its own publications, knew that the economy was adding 10, 20, even 30% of GDP in debt on a annual basis. This is not "unsustainable", it is fraud and an abuse of the currency power granted by The Constitution to Congress.

But Congress knew this too. This publication is not secret. Congress has the power - then and now - to put a stop to it. But Congress decided not to. Not then, not now.

 

More at the link.

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Durables: Topline Horrid, But Under The Hood?

The headline number is scary-bad:

New orders for manufactured durable goods in December decreased $5.0 billion or 2.5 percent to $191.0 billion, the U.S. Census Bureau announced today. This decrease, down four of the last five months, followed a 0.1 percent November decrease. Excluding transportation, new orders increased 0.5 percent. Excluding defense, new orders decreased 2.5 percent.

Ok, that's a deuce too, along with jobless claims. But is it that bad inside?

Well, if you're looking for the forward hiring prospects, it's not particularly good:

 

More at the link.

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Claims: Dropped A Deuce

There's no love here:

In the week ending Jan. 22, the advance figure for seasonally adjusted

initial claims

was 454,000, an increase of 51,000 from the previous week's revised figure of 403,000. The 4-week moving average was 428,750, an increase of 15,750 from the previous week's revised average of 413,000.

Ok, that's bad. CNBS is blaming the increase on snow. Snow? How does snow raise unemployment? If anything it should do the opposite, since people can get paid to shovel or plow it, right?

The "wide view" looks like we're back to people rolling off the benefits list again. That's decidedly negative. But there is one good piece of news in here - the rolloff of people on the regular state claims. If that's not a one-week blip (and it might be), that looks like actual people getting back to work, since only half of them rolled onto the EUC programs.

 

Chart at the link.

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27 January 2011 Last updated at 18:42

 

US financial crisis 'avoidable'

 

Regulators, politicians and bankers were to blame for the 2008 financial meltdown in the US, a report has claimed.

 

BSkyB reports big jump in profits

 

Broadcaster BSkyB reports a 26% jump in half-year pre-tax profit - as efforts by News Corp to buy it are scrutinised.

 

• Keys resigns over sexism furore Sport
  
• Analysis: Media ownership in UK
  

 

 

Met pledges robust hacking probe

 

Police will leave "no stone unturned" in their investigation into allegations of phone hacking at the News of the World, the head of Scotland Yard says.

 

 

Davos 2011

 

 

• Davos 2011: Day 2 as it happened
  
• Sarkozy 'will not let euro fail'
  
• JP Morgan boss warns of debt risk
  
• World leaders warn on food prices
  
• Clegg seeking to calm cuts fears
  
• BBC debate: China's global role Watch
  

 

Other top stories

 

 

• Cost of UK fraud '£38bn a year'
   
  Fraud costs the UK economy £38bn a year, with more than half of that suffered by the public sector, new figures suggest.
  
• US home sales show signs of life
   
  The number of sale contracts on existing US homes registers another uptick in December, suggesting the market has bottomed.
  
• Australia unveils new flood tax
  
• Japan's credit rating downgraded
  
• Rail plan 'to create 8,000 jobs'
  
• Nokia warns of weak start to 2011
  
• Micro-loans 'helped 10 million'
  
• Nintendo profits and sales fall
  
• Tribunal claims face restrictions
  
• Money and health
   
  The contrasts found at this year's gathering in Davos
  
• Exorbitant privilege
   
  How long can the US run larger deficits, for longer, than anybody else?
  

[interestrateripoff]

S.&P. Downgrades Japan as Debt Concerns Spread

 

By HIROKO TABUCHI and BETTINA WASSENER 2:09 PM ET

 

 

The credit rating agency Standard & Poor’s said the Japanese government’s already high debt burden was likely to continue to rise.

 

• DealBook: As Europe Toils on Debt, U.S. and Japan Watch Nervously
  
• Video: Debt Downgrade for Japan
  

 

 

 

Haruyoshi Yamaguchi/Bloomberg News

 

Kaoru Yosano, Japan’s economy minister, right, with Prime Minister Naoto Kan, left, in Parliament this week. Mr. Yosano called the downgrade of Japanese sovereign debt “regrettable.”

 

 

 

 

 

 

In Panel’s Report, Stern Warning on Repeating Financial Crisis

 

By SEWELL CHAN 12:29 PM ET

 

The final report of the Financial Crisis Inquiry Commission delves deeply into the actions — and negligence — that caused the 2008 collapse.

 

• Dissenters Fault Report on Crisis in Finance
  

 

Wall Street Treads Softly After Latest Jobless Data

 

By THE ASSOCIATED PRESS 1 minute ago

 

Traders took in a surprise jump in applications for unemployment benefits and mixed earnings reports from several companies.

 

• Orders for U.S. Factory Goods Fell; Jobless Claims Rose
  

 

Corporate Tax Code Proves Hard to Change

 

By BINYAMIN APPELBAUM 11:37 AM ET

 

A popular step of lowering taxes for industries like trucking would require an unpopular step of raising taxes for industries like biotech.

 

• Economix: Winners, Losers
  

 

G.M. Withdraws Application for $14 Billion Energy Loan

 

By NICK BUNKLEY 1:55 PM ET

 

The carmaker based its decision on improved cash reserves and a desire to avoid more debt. The request had been pending in order to revamp factories and produce more fuel-efficient vehicles.

 

DealBook

 

Russian Investors Seek to Block BP-Rosneft Deal

 

By ANDREW E. KRAMER 2:09 PM ET

 

BP’s partners in the joint venture TNK-BP filed an injunction in a London court to block BP’s deal with Rosneft to exchange shares and jointly explore offshore in the far north.

 

• Exxon and Rosneft to Develop Black Sea Oil Field
  
• At Forum, Medvedev Seeks to Reassure Foreign Investors
  

 

Media Decoder Blog

 

News Corp. to Show iPad App

 

By BRIAN STELTER

 

One year to the day after Steve Jobs unveiled the iPad, the News Corporation says it is ready to unveil its iPad newspaper, The Daily.

 

DealBook

 

Sara Lee to Pursue a Split-Up Instead of a Sale

 

By MICHAEL J. DE LA MERCED

 

The decision was made after Sara Lee's directors determined that preliminary takeover approaches by a consortium led by Apollo Global Management and by JBS of Brazil were not high enough.

 

Media Decoder Blog

 

'Skins' Loses Advertisers - and Viewers

 

By STUART ELLIOTT and BRIAN STELTER

 

MTV's provocative new drama "Skins' sees a dramatic drop in viewership as additional advertisers withdraw their commercials from the series.

 

Sony Introduces New Portable Game Device

 

By HIROKO TABUCHI 6:15 AM ET

 

The Japanese electronics giant is fighting to claw its way back in a market being transformed by longtime rivals, like Nintendo, and those beyond the traditional gaming world, like Apple.

 

A Reservist in a New War, Against Foreclosure

 

By DIANA B. HENRIQUES

 

Deutsche Bank foreclosed on the home of Sgt. James B. Hurley and his wife in violation of a law intended to protect service members from such actions while they are overseas.

[interestrateripoff]

http://www.cnbc.com/id/41290946

 

New U.S. claims for jobless benefits surged last week as snowstorms in some parts of the country kept workers at home, but the underlying trend pointed to an only gradual labor market improvement.

 

Unemployment due to snow!!!!

[interestrateripoff]

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BP faces legal action from billionaire Russian partners

 

BP's three Russian partners in TNK-BP have filed for an injunction in London to stop the British company jumping into bed with their Kremlin-backed rival Rosneft.

BP shuts Dorset field after oil leak

 

 

 

 

Unrest knocks Egypt market to two-year low

 

Egypt's benchmark index plummeted to its lowest level in over two years on Thursday, dropping almost 10pc as protests rattled investor confidence and left Hosni Mubarak's regime facing its most serious challenge in years.

Protests in Suez

 

 

Egypt strife a buying opportunity

 

 

Holiday groups monitor Egypt protests

 

 

 

Bill Gates needs government help to fight polio

 

Davos: Vaccines for the world's diseases are at the top of the Gates Foundation's agenda as Bill and Melianda Gates try to halve the 9m children under five who die every year.

 

BSkyB spends £7m on News Corp bid costs

 

BSkyB said it has racked up costs of £7m relating to News Corporation's proposed takeover of the 61pc of the satellite broadcaster that it does not already own.

Sky chief speaks out on sexism row

 

 

 

Tesco could move into India to solve food crisis

 

India is poised to lift foreign direct investment restrictions for foreign supermarket giants after 17m tonnes of food grain in the country was left to rot last year because there was no space to store it.

 

Employer's Charter leaves the job undone

 

 

 

 

AstraZeneca doubles share buy-back to $4bn

 

 

 

 

House price fall for seventh month in a row

 

 

 

 

Federal Reserve concerned over US job creation

 

 

 

 

Barclays and Lloyds row over future of financial sector

 

 

Firms 'cannot hire' due to lack of skills in labour market

 

More than half of companies worldwide have found it difficult to recruit the right person for a job in the last six months despite the number of people out of work and searching.

[interestrateripoff]

Breaking news

 

• U.S. dollar, Swiss franc boosted by Egypt unrest - Reuters
  
• Adecoagro IPO shares up after pricing at range's bottom - Reuters
  
• Nasdaq snafu zaps index quotes for hour - Reuters
  
• Chinese bank ICBC asks to open unit in Peru - Reuters
  
• Judge denies Kraft injunction in Starbucks dispute - Reuters
  
• Europe airlines change Cairo flights due to curfew - Reuters
  
• Brent nears $100 on Egypt unrest - Reuters
  
• Lowe's COO retiring, won't be replaced - Reuters
  
• Microsoft shares fall on Windows, tablet worries - Reuters
  

 

 

 

• George Osborne offers deal to stop banker bashing
   
  Davos 2011: Chancellor says hostility to bankers is not surprising given their role in financial crisis, writes Larry Elliott
  62 comments
  
  • Hedge fund boss made $5bn in 2010
    

  [*] Hopes rise for US economic recovery

   

  Fourth quarter GDP figures were boosted by buoyant exports and the strongest consumer spending in more than four years

   

  • Risk of US credit-rating downgrade rising – Moody's
    
  • IMF warns of new sovereign debt crisis
    
  • Financial crisis was 'avoidable' - official report
    
  • The billionaires are coming: Obama's richest enemies hold summit
    

  [*] UK consumer poll finds 'astonishing collapse' in confidence

   

  GfK NOP consumer confidence index slumps by a degree only seen six times in 35 years – most recently during 1992 recession

  80 comments

  • John Lewis hit by VAT rise
    

  [*] Highest bidder asks why it lost Channel tunnel rail link sale

   

  Freedom of Information request for auction details as sources confirm that top High Speed One bid did not win franchise

  [*] Land Securities boss is a safe pair of hands with a skyscraper

   

  Francis Salway, chief executive of Land Securities, guided the firm out of the credit crunch and back into the business of putting up tall buildings

 

 

• Women left out in the cold at Davos
   
  Despite its efforts to improve the gender balance, the number of women attending the World Economic Forum is still disappointingly low
  5 comments
  
  • Women at Davos
    
  • Bill Clinton at Davos - video
    
  • Davos 2011: Tony Blair on the deficit - video
    
  • Former MPC member Sir John Gieve
    
  • Cameron attempts to lift economic gloom
    
  • Cameron refuses to 'pump the bubble back up'
    
  • Soros tells Cameron: you are risking a recession
    
  • Sarkozy: eurozone break-up would be unthinkable
    
  • Davos diary: Let's avoid the double-dip, George, we're in a fondue restaurant
    

  [*] Petrol price hits record high

   

  AA joins clamour for chancellor George Osborne to scrap the next planned increase in fuel duty on 1 April

  [*] Financier 'threatened to kill regulators'

   

  Vincent McCrudden arrested in New York on charges of threatening to torture and kill Wall Street regulators

  [*] Ford posts best profit since 2000

   

  Ford makes $6.6bn profit despite slowdown in last quarter as US sales rise 20% but rising concerns over carmaker's $19bn debts

  [*] LinkedIn IPO starts social networking goldrush

   

  Last updated one minute ago

  Business networking website plans to list in New York, beginning an anticipated stampede to the market

   

  • LinkedIn plans to float this year
    

  [*] More business news

  [*] BA union defended by TUC boss in row with Balpa

[interestrateripoff]

Cameron and Osborne: no U-turn on economy

 

 

David Cameron and George Osborne will insist today there can be no turning back from their economic strategy and deep spending cuts despite growing fears of a double-dip recession.

 

• TNK-BP threatens BP's $10bn Rosneft venture
  
• Sarkozy: France and Germany will never ditch the euro
  
• BSkyB results could force Murdoch to increase bid
  
• HSBC staff accused of aiding tax avoiders
  
• Clegg tells rest of world not to panic over Britain's slump
  
• Davos Diary: JD, CEO JPM, coins LOL acronym
  
• The Business On... Sir David Cooksey, Chairman, UKFI
  

 

David Prosser: At least the President is serious about mending French ways

 

 

Davos Outlook For all Nicolas Sarkozy's insistence that the euro will be defended at all costs – and his passion for the project is admirable, even inspiring – the French President has yet to explain how exactly that defence will be mounted. The fact remains that Portugal will almost certainly need a bailout – and sooner rather than later. We know what that means for its neighbour's banks and for the sovereign debt of Spain.

 

 

• David Prosser: Germans throw their gauntlets down first
  
• David Prosser: China and India are the hot tickets as the East rises
  
• David Prosser: Turning inwards won't benefit any of us
  
• David Prosser: Why inequality has moved up the agenda
  
• James Moore: Is Mr Osborne trying to tip us off a cliff with his deficit shock therapy?
  

 

Tony Wray: Open the floodgates: set Britain's water free

 

The Business Interview: Deregulation is the answer to the water industry's challenges, Severn Trent's chief executive tells Sarah Arnott

 

 

• Google: The search engine that lost its way
  
• Secretive trader prepares to open up
  
• The Business on: Robert Schofield, Chief executive, Premier Foods
  
• Down boy! His Master's Voice wavers
  
• Where's the rest of the oil?
  

[interestrateripoff]

Housing shows few signs of gaining momentum - Poll

 

LONDON (Reuters) - The housing market shows little sign of gaining upward momentum in the next two years thanks to an uncertain economy and increasingly stretched consumers, a Reuters poll showed on Friday.

Continue Reading

 

 

 

Egypt unrest rattles world's markets

 

NEW YORK (Reuters) - Crude oil prices surged, world stocks fell and the dollar gained on Friday as images of street battles in Egypt riveted investors and raised concerns the protests will intensify and spread across the Middle East.

8:11pm GMT

 

Consumer spending, trade buoy U.S. economy in Q4

 

WASHINGTON (Reuters) - The U.S. economy gathered speed in the fourth quarter to regain its pre-recession peak with a big gain in consumer spending and strong exports, removing doubts about the recovery's sustainability.

6:45pm GMT

 

John Lewis sales fall as shoppers feel pinch

 

LONDON (Reuters) - Department store chain John Lewis suffered a decline in sales last week, adding to evidence that an increase in VAT sales tax has further weakened already fragile consumer spending. | Video

4:37pm GMT

 

Europe may hold early euro summit in March

 

BERLIN/DAVOS (Reuters) - Europe signalled increased urgency on the eurozone crisis on Friday with the possibility of a special summit sooner than expected, while Germany aired the reforms it might want in exchange for more emergency support.

6:38pm GMT

 

Oil majors BP, Shell concerned about high oil price

 

DAVOS, Switzerland (Reuters) - Oil giants Royal Dutch Shell Plc and BP Plc fear rising oil prices may hinder the recovery of the global economy, chief executives from both firms told Reuters on Friday. | Video

3:13pm GMT

 

Mining stocks drag on FTSE, Egypt worries curb trade

 

LONDON (Reuters) - Britain's leading share index fell on Friday, weighed down by heavyweight miners as a recent rally by the sector went into reverse, and investors worried by dramatic political protests in Egypt decided to close positions.

5:39pm GMT

 

Nasdaq index quote outage leaves traders scrambling

 

NEW YORK (Reuters) - Nasdaq is investigating a problem that caused quotations for its main indexes to be unavailable for about an hour, leaving investors scrambling for key decision-making data at the opening on Friday.

5:23pm GMT

 

RBS pulls out as rescue helicopter bid probed

 

LONDON (Reuters) - The privatisation of Britain's search and rescue helicopter service was thrown into further doubt on Friday after a key member of the consortium bidding for the contract pulled out amid allegations of misconduct.

UK, 10:46am GMT

 

Regulation costs shadow European bank earnings

 

LONDON (Reuters) - Costly new capital rules, a grim end to the year for investment banking and the prospect lenders in Spain and beyond need to raise more cash are casting a shadow over 2010 results from Europe's banks.

[interestrateripoff]

28 January 2011 Last updated at 18:46

 

UK confidence fall 'astonishing'

 

The confidence of UK consumers in the economy and their finances has suffered its biggest drop in 16 years, a survey says.

 

• Shock contraction in UK economy
  

 

Growth in the US economy improves

 

Official figures show that US economic growth accelerated in the last three months of 2010 to an annualised rate of 3.2%.

 

• US home sales show signs of life
  
• PepsiCo boss on US jobs concerns Watch
  

 

 

Davos 2011

 

 

• Day three as it happened
  
• Doha talks 'should end this year'
  
• Aung San Suu Kyi addresses Davos
  
• Geithner resists deficit pressure
  
• Lagarde confirms bail-out moves
  
• Cameron sticking to 'tough' plan
  
• Google hints at China ambitions
  
• In pictures: Davos 2011
  

 

Other top stories

 

 

• Pontin's bought by UK hotel group
   
  Holiday camp company Pontin's has been bought by Britannia Hotel Group, saving 850 jobs, administrators say.
  
• Ford sees best profit in 11 years
   
  US carmaker Ford reports a profit of $6.6bn (£4.1bn) in 2010 - its best performance in more than a decade.
  
• Unions 'united over pension cuts'
  
• Diesel price reaches record high
  
• Debt advisers surrender licences
  
• Amazon e-books outsell paperbacks
  
• Phone firms deny VAT overcharging
  
• Spanish deal on age of retirement
  
• Smartphones help Samsung profits
  

 

Investment messages

 

The different approaches of the UK and Germany

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Osborne calls time on bank bashing

 

George Osborne has given a clear signal the Government wants to halt the long period of “banker bashing” by admitting “we need to move on”.

Cameron: Britain must 'stick to the course'

 

 

Cometh the hour, cometh the Davos heavyweights

 

 

It's hard to share Cameron’s optimism on Europe

 

 

David Cameron rules out further euro bailouts

 

 

 

 

Merkel: Austerity preferable to euro break-up

 

Preserving Europe’s single currency is vital for peace on the continent, German Chancellor Angela Merkel has claimed, and said pay cuts, pension reforms and austerity drives are preferable to an EMU break-up.

 

Consumer confidence suffers worst collapse

 

Britons' confidence in the economy and their finances suffers its biggest drop in close to 20 years, raising fears that the Government's austerity onslaught will set off a self-feeding downward spiral.

 

Charities exploit 'bomb-site tax' loophole

 

Landlords are conspiring with charities to exploit a loophole in rating laws to avoid paying millions of pounds in business rates, according to an industry expert.

Business rates: the loopholes

 

 

Why landlords hate the 'bomb-site Britain' tax

 

 

 

Consumers, exports drive rise in US GDP

 

The US economy gathered speed in the fourth quarter, though a touch below expectations, with the biggest gain in consumer spending in more than four years and strong exports.

Japan downgrade a warning shot for US, EU

 

 

 

Christie's best year in 245-year history

 

 

 

 

Oligarchs take action against BP

 

 

 

 

Marston's and Fuller's report happy Christmas trading

 

 

 

 

Healthcare Locums investigated by NHS fraud officers

 

 

 

 

LinkedIn takes the plunge with IPO

[interestrateripoff]

Revamping, Home Depot Woos Women

 

By STEPHANIE CLIFFORD 11:52 AM ET

 

 

To balance a drop in items sold for big renovations, the company is trying to get women, 50 percent of its customers, excited about more modest makeovers.

 

 

 

Erik S. Lesser for The New York Times

 

Jolynn Arway purchases Martha Stewart Living paint at a Home Depot store in Atlanta this week.

 

 

 

 

 

 

U.S. Economy Grew at 3.2% Rate in the 4th Quarter

 

By CATHERINE RAMPELL 12:29 PM ET

 

The number, slightly below analysts’ expectations, reflected a sharp rise in consumer spending.

 

• Floyd Norris: The American Economy: Bigger Than Ever
  

 

Wall Street Indexes Fall on Concerns About Egypt

 

By THE ASSOCIATED PRESS 1 minute ago

 

In addition to news that the U.S. economy grew 3.2 percent in the fourth quarter, traders were taking in a number of corporate results.

 

Ford Shares Tumble as Fourth Quarter Misses Forecast

 

By NICK BUNKLEY 1 minute ago

 

Ford said that sales in Europe were lower than expected and that it had spent considerable resources introducing new models.

 

DealBook

 

Sara Lee Confirms Plan to Split

 

By AZAM AHMED

 

The food business, with annual revenue of $4.1 billion, will be spun off. And the company announced a new chief executive.

 

Crisis Panel’s Report Parsed Far and Wide

 

By SEWELL CHAN

 

As Wall Street analysts scoured 1,200 supporting documents that the panel released, complaints arose that the Financial Crisis Inquiry Commission did not “reach even a rough consensus.”

 

• Dissenters Fault Report on Crisis in Finance
  
• DealBook: Outtakes From the Crisis Commission Report
  

 

U.S. Approves Genetically Modified Alfalfa

 

By ANDREW POLLACK

 

The agriculture secretary pulled back from a proposal that would have restricted the growing of genetically engineered alfalfa to protect organic farmers.

 

U.S. Company, in Reversal, Wants to Export Natural Gas

 

By CLIFFORD KRAUSS

 

Charif Souki, chief of Cheniere Energy, envisions a network of terminals exporting cheap American natural gas to Europe and Asia.

[interestrateripoff]

4Q GDP: Is That Daylight, Or A Headlight?

When in a tunnel, that's a key question and you better not get it wrong.

Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- increased at an annual rate of 3.2 percent in the fourth quarter of 2010, (that is, from the third quarter to the fourth quarter), according to the "advance" estimate released by the Bureau of Economic Analysis. In the third quarter, real GDP increased 2.6 percent.

That would normally be an extremely bad estimate. Why? Because the BEA almost always "overestimates" (or is that just making it up?) on their advance numbers, and then revises down. It also was a miss against expectations. So let's take a look inside.

The acceleration in real GDP in the fourth quarter primarily reflected a sharp downturn in imports, an acceleration in PCE, and an upturn in residential fixed investment that were partly offset by downturns in private inventory investment and in federal government spending and a deceleration in nonresidential fixed investment.

A sharp downturn in imports? Hmmm.... how do you get an acceleration in PCE if imports are decreasing and we're not transferring manufacturing jobs back here?

 

Denniger on the latest US GDP figures.

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http://www.bloomberg.com/apps/quote?ticker=BDIY:IND

 

5yr Baltic Dry showing the global recovery since the collapse......

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http://www.telegraph.co.uk/finance/jobs/8289578/Employers-to-be-fined-50pc-of-award-if-they-lose-employment-tribunals.html

 

Employers that lose an employment tribunal case would be fined 50pc of the award under an “astonishing” proposal buried within a new Government consultation.

 

Organisations found to have breached an individual’s rights would be forced to pay the Exchequer half the amount of the total compensation award, on top of the payout itself, according to the proposal introduced on page 52 of the 88-page document.

 

The plans threaten to undermine David Cameron’s “pro-business, pro-growth” agenda, lobby groups warned.

 

An upper limit of £5,000 is being considered, reduced by half for employers that pay within 21 days. It would be the first time organisations would be penalised for losing a case.

 

Business groups are stunned by the measure which sits within the same document that pledges to “remove barriers to growth and job creation”. It also comes alongside the Government’s new Employer’s Charter, aimed at reducing the burden of employment law.

 

Manufacturers’ organisation the EEF branded the proposal a “revenue generator”. Steve Radley, director of policy, said: “On the day Government announced an Employer’s Charter to reassure business about the balance of employment legislation, it undermined this principle by burying a potential new tax at the back of a lengthy consultation. [The fine] would impose extra costs at a time when companies are already under immense pressure.”

 

Tax revenues falling then create new taxes and look for ways of ensuring people can't get out of paying.

 

Anyone know how many cases are won by employees each year? The on the back of a fag pocket guess at how much revenue this tax could bring in is?

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http://www.zerohedge.com/article/federal-reserve-balance-sheet-update-week-january-26-1129-trillion-ust-holdings

 

The steady climb in Fed assets continues, with the left side of Bernanke's balance sheet swelling to just under $2.5 trillion, as US Treasury holdings hit $1.13 trillion, implying that the Fed's DV01 continues to increase on a daily basis with every single POMO, as we have been pointing out since last summer, and which the Fed decided to address last week by changing its "accounting" rules and guaranteeing its assets can never decline. The differential between the US and China is now $233 billion and rising. We expect our now second-largest creditor to realize the game theory balance of leverage (no pun intended) is shifting away from its favor (and to the Fed), and to respond accordingly. Alternatively, maybe someone will finally readjust the UK's holdings to properly reflect what could very likely be simply Chinese debt accumulation.

 

All numbers as of December 26:

 

• Securities held outright: $2,224 billion, $18.5 billion more than the week prior.
  
  • Total Treasury holdings increased from $1.080 trillion to $1.129 trillion (inclusive of the last two days' POMOs).
    
  • MBS declined by $15.1 billion.
    
  • Agency holdings declined by $1.2 billion to $144.6 billion.
    

  [*]Net borrowings: down to $25 billion.

  [*]Float, liquidity swaps, Maiden Lane and other assets: $178 billion, $1 billion more than a fortnight ago. FX liquidity swaps were at $70 million as that one bank continues to borrow the same amount for 5 months now. The value of Maiden Lane I was $26.4 billion. Maiden Lane II was at $16 billion, Maiden Lane III at $22.4 billion, AIA Aurora has now been paid off. And it is perhaps important to note that only the Federal Reserve would have "Other Assets" of $115 billion.

  [*]The monetary base was $2.050 trillion.

  [*]Reserve balances with banks: $1083 billion, an increase of $65 billion from last week. With assets increasing rapidly, it was about time this lagging liability category caught up.

  [*]Foreign holdings of USTs and MBS increased by $5 billion to $3.353 trillion.

One thing to highlight in the data above:

 

• After stagnating for a while, the MBS prepay has picked up again, and last week saw a cumulative $16.3 billion in MBS being put back to the Fed. This brings the total to $184 billion since the start of QE Lite. The last month's total MBS/agency prepay amounts to $30 billion which means that the Fed has an incremental $30 billion in Treasurys to purchase per the QE Lite mandate, although still run rates at less than the $2-300 billion the Fed hopesto achieve to get to $900 billion in bond purchases. As the MBS total on the Fed's balance sheet declines, it means there is an ever greater probability of MBS purchases being part of QE3.
  

And, as usual we end with our favorite chart, showing total UST holdings by the top 5 world institutions.

 

Still what's a few trillion between friends....

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http://www.independent.co.uk/news/world/politics/enough-is-enough-says-imf-as-spending-spree-revives-us-economy-2197778.html

 

Speaking in Davos, the US Treasury Secretary, Tim Geithner, said: "There's much more confidence now that we've got a sustainable expansion." However, he cautioned; "It's not a boom. It's not an expansion that's going to offer a rapid decline in unemployment."

 

However, doubts persist about whether the current pace of US expansion is sustainable, and her $10trillion national debt. As in the UK, America's fiscal deficit this year will run at about 10 per cent of national income.

Launching the Fund's latest Fiscal Monitor, designed to help police the world's major economies, the IMF's fiscal affairs director Carlo Cottarelli said: "The US has a lot of credibility. This does not imply their credibility can last forever." The Fund criticises the American budget reduction plan for not containing "binding multiyear restrictions on total spending" . It recommends: "In advanced economies where fiscal sustainability has not been a market concern, credible plans going well beyond 2011 need to be put in place urgently to lock in benevolent market sentiment."

 

Much will now depend on what working arrangements can be reached between Congress and President Obama, after the President offered to work with legislators in his State of the union address earlier in the e week. Some bipartisan spirit was displayed in remarks from the White House press secretary Robert Gibbs: "This is a problem many years in the making and will take a concerted effort by Democrats and Republicans working together to find a solution," he said.

 

The IMF also criticised Japan for running a similarly large deficit. Of the major industrialised economies, Japan boasts by far the largest national debt, approaching 200 per cent of GDP, proportionately three times that of the UK.

 

At the moment about half of Japan's long-term government debt is held by its own citizens, habitually hard savers. However, an ageing population means fewer workers able to buy bonds, and any rise in interest rates from the current near-zero levels would add massively to the bill for servicing the debt.

 

Glenn Uniacke, Senior Dealer at Moneycorp in London, commented; "The US government should be concerned about their longer-term problems. By not focusing on the US deficits and debt pile, any current growth rate is questionable. While the UK Government's actions may possibly send us into a double dip recession, perhaps it would be worth suffering the pain in the short term, in exchange for long-term prosperity."

 

Timmy is hilarious a sustainable economic recovery based on borrowing 10% of GDP which of course by default adds into GDP.

 

Got to love the sucking up by the IMF that the US is credible

 

Still I'm just relieved it's all contained and as Timmy points out US unemployment is going to rapidly decline...... Probably by people no longer qualifying for benefit rather than jobs being created by the globalists.

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Breaking news

 

• Mubarak names deputy, protesters defy curfew - Reuters
  
• Investors face rising risks however Egypt plays out - Reuters
  
• No call for emergency OPEC meeting -Iran OPEC gov - Reuters
  
• Swiss economy minister backs central bank leaders -paper - Reuters
  
• Osborne says UK corps should spend spare cash - Reuters
  
• Osborne says UK corps should spend spare cash - Reuters
  
• Alpha close to $7 bln Massey deal-sources - Reuters
  
• Alpha Natural Resources close to Massey deal - Reuters
  
• Egypt's Mubarak sends in army, resists demands to quit - Reuters
  

 

 

 

• George Osborne offers deal to stop banker-bashing
   
  Chancellor says hostility to bankers not surprising given their role in financial crisis, writes Larry Elliott
  115 comments
  
  • Cameron promises budget for growth
    
  • Hedge fund boss made $5bn in 2010
    

  [*] Hopes rise for US economic recovery

   

  Fourth-quarter GDP boosted by buoyant exports and strongest consumer spending in more than four years

   

  • Risk of US credit-rating downgrade rising – Moody's
    
  • IMF warns of new sovereign debt crisis
    
  • Financial crisis was 'avoidable' - official report
    
  • Obama's richest enemies hold summit
    

  [*] 'Astonishing' consumer confidence slump

   

  GfK NOP consumer confidence index falls by a degree only seen six times in 35 years – most recently during 1992 recession

  105 comments

  • John Lewis hit by VAT rise
    

  [*] Petrol price reaches record high

   

  AA joins clamour for chancellor George Osborne to scrap the next planned increase in fuel duty on 1 April

  [*] LinkedIn starts social network goldrush

   

  Business networking website plans to list in New York, beginning an anticipated stampede to the market

 

 

• Women left out in the cold at Davos
   
  Despite its efforts to improve the gender balance, the number of women attending the World Economic Forum is still disappointingly low
  6 comments
  
  • Women at Davos
    
  • Tony Blair on the deficit
    
  • Former MPC member Sir John Gieve
    
  • Soros tells Cameron: you are risking a recession
    
  • Sarkozy: eurozone break-up would be unthinkable
    
  • Davos diary: Let's avoid the double-dip, George
    

  [*] Financier 'threatened to kill regulators'

   

  Vincent McCrudden arrested in New York on charges of threatening to torture and kill Wall Street regulators

  [*] Ford posts best profit since 2000

   

  Ford makes $6.6bn profit despite slowdown in last quarter as US sales rise 20% but rising concerns over carmaker's $19bn debts

  [*] More business news

  [*] Row over Channel tunnel rail link sale

  [*] BA union defended by TUC boss in row with Balpa

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Enough is enough, says IMF as spending spree revives US economy

 

Obama warned that America's borrowing is getting out of hand – while Cameron and Osborne praised for deficit reduction plan

 

• Fifty debt firms to go as OFT launches crackdown
  
• Spectre of currency war rears its head at Davos
  
• Pontin's lives on as administrator finds buyer for holiday camp chain
  
• Cameron and Osborne seek to move the agenda forward
  
• US Treasury head: UK-style cuts will hinder recovery
  
• Marston's enjoys a merry Christmas despite snow
  
• Davos Diary: Bigwigs choose to fill their boots
  

 

Stephen Foley: The trouble with the FCIC is it agonised too long over who was wrong, rather than why

 

 

US Outlook: Since every man and his dog appears to have a dissenting opinion on the Financial Crisis Inquiry Commission report, allow me, too.

 

 

• David Prosser: How to change the world – and do a bit of skiing at the same time
  
• David Prosser: At least the President is serious about mending French ways
  
• David Prosser: Germans throw their gauntlets down first
  
• David Prosser: China and India are the hot tickets as the East rises
  
• David Prosser: Turning inwards won't benefit any of us
  

 

The last page for the paperback?

 

As Amazon sees e-book sales overtake paperbacks, the industry is wondering how long print can be economical

 

 

• The business on...Gudjon Reynisson, Chief executive, Hamleys
  
• Tony Wray: Open the floodgates: set Britain's water free
  
• Google: The search engine that lost its way
  
• Secretive trader prepares to open up
  
• The Business on: Robert Schofield, Chief executive, Premier Foods
  

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Osborne says will only do "good" deal with banks

 

DAVOS, Switzerland (Reuters) - Britain will only do a deal with banks on bonuses and lending in return for government backing if it was a "good deal," Chancellor George Osborne said Saturday .

Continue Reading

 

 

 

Euro zone crisis seen turning corner

 

DAVOS, Switzerland (Reuters) - European policymakers and international bankers at the Davos forum said on Saturday the euro zone's debt crisis had turned a corner and any doubt about the survival of the single currency area had passed. | Video

1:52pm GMT

 

Global stocks tumble on Egypt unrest, oil jumps

 

NEW YORK (Reuters) - Stock markets around the world slumped, crude oil prices surged and the dollar gained on Friday as images of escalating violence and chaos in Egypt gripped investors and raised concerns the protests will spread across the Middle East. | Video

1:30am GMT

 

Housing shows few signs of gaining momentum - Poll

 

LONDON (Reuters) - The housing market shows little sign of gaining upward momentum in the next two years thanks to an uncertain economy and increasingly stretched consumers, a Reuters poll showed on Friday.

UK 7:40am GMT

 

Consumer spending, trade buoy U.S. economy in Q4

 

WASHINGTON (Reuters) - The U.S. economy gathered speed in the fourth quarter to regain its pre-recession peak with a big gain in consumer spending and strong exports, removing doubts about the recovery's sustainability.

28 Jan 2011

 

Goldman CEO gets salary boost, $12.6 million shares

 

NEW YORK (Reuters) - Goldman Sachs Group tripled Chief Executive Lloyd Blankfein's base salary and awarded him $12.6 million (7.9 million pounds) of stock, even after the bank's net income plunged last year.

1:38am GMT

 

Higher costs sink Ford profit, shares slide

 

DETROIT (Reuters) - Ford Motor Co's earnings fell far short of expectations on surging costs for new vehicle launches and an unexpected loss in its European business, driving its shares down more than 13 percent.

28 Jan 2011

 

John Lewis sales fall as shoppers feel pinch

 

LONDON (Reuters) - Department store chain John Lewis suffered a decline in sales last week, adding to evidence that an increase in VAT sales tax has further weakened already fragile consumer spending. | Video

28 Jan 2011

 

Europe may hold early euro summit in March

 

BERLIN/DAVOS (Reuters) - Europe signalled increased urgency on the eurozone crisis on Friday with the possibility of a special summit sooner than expected, while Germany aired the reforms it might want in exchange for more emergency support.

28 Jan 2011

 

Oil majors BP, Shell concerned about high oil price

 

DAVOS, Switzerland (Reuters) - Oil giants Royal Dutch Shell Plc and BP Plc fear rising oil prices may hinder the recovery of the global economy, chief executives from both firms told Reuters on Friday.

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29 January 2011 Last updated at 16:57

 

Egypt turmoil shakes WEF in Davos

 

Leaders in Davos express concern about the political situation while Tunisia's new leaders say their country is now "open for business".

 

• Davos 2011: Day 4 as it happened
  

 

Lagarde denies 'chronic' problem

 

Christine Lagarde defends the euro, disagreeing with Barclays' Bob Diamond that the situation has gone from "acute" to "chronic".

 

• Sarkozy 'will not let euro fail'
  
• Lagarde confirms bail-out moves
  

 

 

Goldman boss gets $15m pay award

 

Wall Street firm Goldman Sachs Group triples the salary of chief executive Lloyd Blankfein to $2m and awards him $12.6m in shares.

 

 

Davos 2011

 

 

• Osborne seeks 'consistent growth'
  
• Doha talks 'should end this year'
  
• Geithner resists deficit pressure
  
• Aung San Suu Kyi addresses Davos
  

 

Other top stories

 

 

• UK confidence fall 'astonishing'
   
  The confidence of UK consumers in the economy and their finances has suffered its biggest drop in 16 years, a survey says.
  
• Growth in the US economy improves
   
  Official figures show that US economic growth accelerated in the last three months of 2010 to an annualised rate of 3.2%.
  
• Pontin's bought by UK hotel group
  
• Ford sees best profit in 11 years
  
• Solar subsidy 'to be protected'
  
• Rising trade in 'take-away' homes
  
• Unions 'united over pension cuts'
  
• Diesel price reaches record high
  
• Debt advisers surrender licences
  
• US v UK
   
  Two countries, divided by a deficit
  

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Riots force Egypt market shutdown

 

Egypt's banks will stay closed on Sunday, the first day of the country's business week, a move analysts said could spook investors looking to trade after unprecedented protests.

Egypt riots rock world markets

 

 

Saudi tumbles on Egypt protests

 

 

USA's secret backing for rebel leaders behind Egyptian uprising

 

 

 

 

Employers fined half of award for lost tribunals

 

Employers that lose an employment tribunal case would be fined 50pc of the award under an “astonishing” proposal buried within a new Government consultation.

How much do tribunal winners get?

 

 

Fining employers who lose at tribunals is 'bizarre and unhelpful'

 

 

 

Osborne calls time on bank bashing

 

George Osborne has given a clear signal the Government wants to halt the long period of “banker bashing” by admitting “we need to move on”.

Swiss police fire at Davos demo

 

 

Cameron: Britain must 'stick to the course'

 

 

Sorrell: 'The west wants inflation'

 

 

It's hard to share Cameron’s optimism on Europe

 

 

 

Merkel: Austerity preferable to euro break-up

 

Preserving Europe’s single currency is vital for peace on the continent, German Chancellor Angela Merkel has claimed, and said pay cuts, pension reforms and austerity drives are preferable to an EMU break-up.

 

Consumer confidence suffers worst collapse

 

 

 

 

Unite sues Ford over '£350m pension hole'

 

 

 

 

Charities exploit 'bomb-site tax' loophole

 

 

 

 

Goldman chief Blankfein handed $12.6m stock bonus

 

 

 

 

BP set to restart dividend

 

 

 

 

Christie's best year in 245-year history