Financial life in a big town

January 26, 2012

Babacan Dismisses IMF Forecasts, Predicts Turkish Economy to Expand 4% - Bloomberg

Filed under: Finance, term — Tags: , , , — Silver @ 4:08 am

Turkey stands by its forecast of 4 percent growth this year, Deputy Prime Minister Ali Babacan said, dismissing International Monetary Fund projections that the economy may barely expand.

The global environment is uncertain and there are major decisions to be taken in developed nations in the next four or five weeks that could change the outlook completely, Babacan said in a televised interview from Davos today. The IMF is

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January 24, 2012

Starbucks to offer alcohol in more locations

Filed under: Lending rates, term — Tags: , , , — Silver @ 1:08 pm

Listen up, beer lovers — you may soon be able to get your suds in grande form. At Starbucks.

Starbucks said Monday that it would begin offering beer and wine at select locations in Atlanta and Southern California by the end of this year, to go along with several locations in the Chicago area that have previously been announced.

Starbucks (, Fortune 500) began the initiative in the Pacific Northwest in late 2010.

"As our customers transition from work to home, many are looking for a warm and inviting place to unwind and connect with the people they care about," Clarice Turner, Starbucks’ senior vice president for U.S. operations, said in a statement payday loan lenders.

"We’re pleased with the response of our customers to the introduction of wine, beer and premium food at several of our stores in the Pacific Northwest, and we’re excited to see how the idea translates to other markets."

The "enhanced menu" at these locations will also include savory snacks, small plates, and hot flatbreads, Starbucks said. The wines and beers on offer "will be hand-selected to reflect local customer tastes and preferences," the company added. 

Source

As with fast payday loans, this recently used to be the case, but competitive lenders and higher demand has taken this loan type to mainstay levels.

January 17, 2012

Feisty Sarkozy shrugs off French credit downgrade

Filed under: Finance, term — Tags: , , , — Silver @ 11:20 pm

French President Nicolas Sarkozy bluntly declared Monday that a harsh downgrade by Standard & Poor’s of France’s formerly top-rung debt rating “changes nothing” for the eurozone’s No. 2 economy.

Sarkozy, in a testy exchange with a journalist at a Madrid news conference, suggested that a solid investor demand for a French debt auction Monday and a reaffirmation from rival ratings agency Moody’s of France’s triple-A sovereign debt had offset S&P’s much-publicized downgrade.

“We have to react to this with calm, by taking a step back,” he told reporters during a visit with Spain’s new prime minister, Mariano Rajoy. “At the core, my conviction is that it changes nothing.”

The S&P downgrade Friday _ which Sarkozy’s own finance minister called “bad news” _ came just 100 days before the president faces what is expected to be a tough re-election campaign.

The news conference began combatively when Sarkozy refused to answer a question about whether France’s downgrade would affect its ability to lead Europe out of the crisis _ and if the move prompted the postponement of a crisis summit for him and the leaders of Germany and Italy next week.

Sarkozy and German Chancellor Angela Merkel have taken the lead in proposing solutions to the crisis and major decisions are often hashed out at their meetings ahead of European summits.

“You don’t have the latest information,” Sarkozy retorted to a reporter who asked about the downgrade and the summit. Sarkozy refused to answer even after the reporter rephrased his question twice.

The French leader later confirmed that the three-way summit would take place in February and downplayed the S&P downgrade, but never gave a clear answer as to why the summit was rescheduled.

Sarkozy did manage to win much-needed political support from Rajoy _ notably for his pet project for a financial transaction tax that could help ailing European state coffers get out of the red.

France, which has long enjoyed relatively low borrowing costs and had S&P’s top-tier AAA rating uninterrupted since the mid-1970s, on Friday was the largest of nine eurozone members hit by S&P downgrades _ dropping one notch to AA+. The agency also kept a negative outlook on French state debt.

Analysts said Sarkozy’s denial that the downgrade meant much was wishful thinking guaranteed payday loan.

“The fact that there is a negative outlook, it means that there is a probability _ a quite high probability _ of further downgrade in 2012, 2013,” said French economist Norbert Gaillard. “So it’s bad news for France.”

But in a vindication of sorts for Sarkozy, France sold euro8.6 billion ($10.9 billion) in short-term debt on Monday. The yields _ or the interest rates charged by investors on the debt _ fell, a sign investors still see the country as a good bet.

Spain was also hit by an S&P downgrade, from AA- to A+, but Rajoy said that blow and downgrades for other European nations shouldn’t be seen as a sign they will have trouble emerging from the financial crisis.

Rajoy’s Socialist predecessor also supported the financial transaction tax, but Jose Luis Rodriguez Zapatero was ousted from office by Spaniards angry about the country’s hurting economy and high unemployment.

The European Commission has estimated that the tax could raise as much as euro57 billion ($72.2 billion) a year, funds that could be used to help reduce the substantial budget deficits crippling European economies.

Moody’s cited France’s economic strength as a reason for affirming its top rating, but said bleak growth prospects in France and the region present “risks to the French government’s fiscal consolidation plans.”

Moody’s said it would again review French debt later in the first quarter as part of a broader look at sovereign debt within the EU _ meaning a decision is likely close to France’s two-round presidential vote in April and May.

Sarkozy’s challengers for the presidency _ including Socialist nominee Francois Hollande _ have seized on the S&P downgrade as evidence that his policies are wrong-headed and ineffective.

It will be a bruising election battle for Sarkozy, a dynamic leader who has a strong international profile but is widely disliked at home. Leftists say he has coddled the rich, while many of those who supported him in his 2007 campaign say he hasn’t fulfilled his promises.

And Hollande is currently leading in the polls.

Source

January 8, 2012

Chinese premier pledges more entrepreneur loans

Filed under: technology, term — Tags: , , , — Silver @ 5:56 pm

China’s premier has pledged to tighten risk controls on its banks and see that they do more to help entrepreneurs to sustain economic growth in the face of a possible global slowdown.

Premier Wen Jiabao said at a weekend financial planning conference Saturday that China’s financial industries are sound but still face risks. He vows to press ahead with reforms aimed at giving market forces more influence over lending, but no details have been announced no checking account payday advance.

China’s state-owned banks avoided the financial turmoil that battered Western institutions, but a slump in global demand and exports is fueling concern its relatively robust economic growth might slow dangerously.

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December 29, 2011

Swiss Skiing Gets Cheaper as Resorts Cut Prices - Bloomberg

Filed under: legal, term — Tags: , , , — Silver @ 4:52 am

Four years after Bruno Prior paid less than a dollar for an unprofitable ski resort in the Swiss Alps, the strength of the country

November 10, 2011

Siemens AG returns to profit in Q4

Filed under: Finance, term — Tags: , , , — Silver @ 6:04 am

German industrial equipment maker Siemens AG swung back to profit in its fiscal fourth quarter as sales increased in Asia.

The company said Thursday it made a net profit of euro1.23 billion ($1.66 billion) in the three months to end-September in contrast to the loss of euro396 million loss in the same quarter a year ago, when the company had a large one-time charge at its health care division.

The company increased its dividend but gave an outlook for only moderate sales growth and indicated it didn’t expect profits to rise next year.

Revenues rose 5 percent to euro20.35 billion, boosted by a 12 percent increase in Asia. The company said Thursday sales grew across all regions and experienced particularly strong growth in emerging markets.

Orders, however, fell 2 percent and the company forecast only “moderate” sales growth. It said its outlook for earnings in the coming year were “based on the high level we achieved in the prior year” and foresees earnings from continuing operations that are unchanged, excluding one-time gains from exiting its nuclear partnership with Areva.

Company CEO Peter Loescher said the company had performed well thanks to its balanced portfolio of businesses but warned that the economic environment ahead was uncertain.

“The macroeconomic environment continues to be volatile and difficult to assess,” he said.

He said he expected growth in Europe’s core markets but that turmoil from Europe’s debt crisis could hurt the business environment in southern Europe _ which remains only 5 percent of Siemens’ business.

The company raised its dividend to euro3.00 per share from euro2.70 per share last year.

Across Siemens divisions, its fossil-fuel power generation unit raised earnings by 10 percent to euro407 billion. Its power transmission equipment divisions, however, saw earnings slip 28 percent due to costs of hedging raw materials costs and the emergence of new competitors in low-cost countries.

Munich-based Siemens makes a wide range of heavy industrial goods, including trains and streetcars, power generating and transmission equipment, diagnostic machines for hospitals and factory automation and equipment.

Source

October 13, 2011

Protesters suspicious of plan to clean up NYC park

Filed under: economics, term — Tags: , , , — Silver @ 2:52 pm

Protesters expressed fears Thursday that a scheduled cleanup of the private park where they’ve been camped out near Wall Street is merely a ploy to unravel the demonstration.

City officials have informed protesters that they will need to leave Zuccotti Park on Friday so that it can be cleaned, but that they’ll be allowed to return afterward.

As a steady drizzle fell Thursday over the park, owned by Brookfield Properties, confusion was high over when the protesters will be ordered out _ and where they’ll go during the evacuation.

“The cleanup is a pretext to remove us from the camp. And we can return only if we abide by the rules of Brookfield Properties,” said Justin Wedes, 25, a public high school science teacher from Brooklyn who was sweeping the pavement with others. “We’re redoubling our efforts today.”

Brookfield did not immediately respond to requests for comment on the cleanup. City officials remained mum on logistics.

“This is the cleanest protest I’ve ever witnessed,” said Emilio Montilla, 29, a laid-off teacher’s assistant. “We take care of ourselves. We’re self-sufficient.”

A notice handed out to protesters Thursday from Brookfield stated that the cleaning is part of daily upkeep, and that conditions have deteriorated in recent weeks because that upkeep was put on hold by the protesters.

“They’re going to use the cleanup to get us out of here!” Wedes said. “It’s a de facto eviction notice.”

Deputy Mayor Cas Holloway said in a statement Wednesday that the protest has “created unsanitary conditions and considerable wear and tear on the park.” He said Brookfield asked for police help to clear the park so it can be cleaned.

Holloway said the cleaning will be done in stages Friday. Mayor Michael Bloomberg visited the protesters Wednesday to offer assurances.

Allison Esso of Human Services Council, a group that supports the protesters, was wary. “I’m hoping that they’re not trying to undermine their ability to protest,” she said.

The protest, known as Occupy Wall Street, has sympathetic groups in other cities which each stage their own local rallies and demonstrations: Occupy Boston, Occupy Cincinnati, Occupy Houston, Occupy Los Angeles, Occupy Philadelphia, Occupy Providence, Occupy Salt Lake, and Occupy Seattle, among them saving account pay day loan.

The movement has also drawn reaction from world leaders, including President Barack Obama, former Polish President Lech Walesa and Iran’s Ayatollah Ali Khamenei.

Walesa said Thursday that he supports the New York protest and is planning to either visit or write a letter to the protesters. He said the global economic crisis has made people aware that “we need to change the capitalist system” because we need “more justice, more people’s interests, and less money for money’s sake.”

Khamenei said Wednesday that the wave of protests reflects a serious problem that will ultimately topple capitalism in America. He claimed the United States is in a full-blown crisis because its “corrupt foundation has been exposed to the American people.”

Khamenei’s remarks came a day after U.S. officials said the Obama administration plans to leverage charges that Iran plotted to assassinate Saudi Arabia’s ambassador into a new global campaign to isolate the Islamic republic.

Protesters, who have been living, sleeping and eating in the park for the duration, say they are in it for the long haul, despite the onset of cold weather.

On Wednesday, police arrested four people outside JP Morgan Chase offices where Wall Street protesters called in vain for a meeting with Chairman and CEO Jamie Dimon. Protesters accused the police of rough handling. An Associated Press photographer witnessed police officers heading into the crowd of demonstrators to make the arrests.

Meanwhile, about 700 members of the Service Employees International Union marched through the Financial District; the union, which represents 23,000 office cleaners, is gearing up for contract negotiations with the Realty Advisory Board.

More protests are planned in Toronto and Vancouver this weekend, and European activists also are organizing.

A lawyer for a woman pepper-sprayed during an action last month is demanding that the Manhattan district attorney prosecute an NYPD deputy inspector on an assault charge. Commissioner Raymond Kelly said the matter was being investigated by police internal affairs and the Civilian Complaint Review Board.

Source

October 3, 2011

Gunmen kill 4 in hostage standoff in western Iraq

Filed under: Uncategorized, term — Tags: , , , — Silver @ 1:40 pm

Gunmen disguised as police officers seized control of a police station in western Iraq Monday morning, killing four people and taking dozens of hostages before Iraqi forces swept in and ended the standoff, Iraqi officials said.

The three-hour hostage crisis, as well as another attack nearby on a police officer’s house, demonstrated the vulnerability of the Iraqi security forces at a time when American troops are swiftly drawing down their presence after more than eight years of war.

Four insurgents wearing explosives vests underneath police uniforms and armed with grenades and pistols with silencers walked into the police compound in al-Baghdadi around 9 a.m., said Brig. Mohammed al-Fahdawi of the Iraqi army’s 7th Division in Anbar province. Because the gunmen were wearing police uniforms, they were not searched, he said.

The gunmen shot and killed three police officers, including the director of the police station, and an employee in the mayor’s office before seizing weapons held in the police station, said al-Fahdawi, who coordinated the rescue operation.

The gunmen herded the hostages into some of the rooms, said a police officer at the scene who did not want to be identified because he was not authorized to speak to the media.

After the Iraqi army arrived on the scene and exchanged gunfire with the assailants, al-Fahdawi said he ordered his men to storm the building.

The mayor, Muhanad Zbar Mutlaq, was inside at the time.

After hearing the shooting, the mayor grabbed his cell phone and ran into the bathroom next to his office, locking the door behind him. He said he put his cell phone on silent and began sending text messages to Iraqi army officers he knows.

“Some of the terrorists entered my office and one of them picked up my landline phone when it was ringing and said: ‘We are the fighters of the Islamic State of Iraq,’” said Mutlaq. The Islamic State of Iraq is a front group for al-Qaida. Mutlaq said he could tell by the speaker’s voice that he was Iraqi.

“When I was rescued I saw blood everywhere with pieces of human flesh of the two terrorists who blew themselves up,” he added.

Two of the insurgents blew themselves up when Iraqi police stormed the station to free the estimated 40 people held inside, said al-Fahdawi. Security forces killed the other two assailants, he said.

Deputy governor of Anbar province Dhari Arkan confirmed that the hostage standoff had ended and said four people were killed.

“The security measures here are zero. Some weeks ago terrorists were able to blow up the provincial council and today they were able to break into a police station,” he said.

Earlier this month, two suicide bombers blew themselves up in front of the government compound in the Anbar provincial capital of Ramadi, killing four people and wounding eight others.

Insurgents frequently go after Iraqi government targets in an effort to destabilize the security situation, and the Ramadi building has been targeted repeatedly by suicide bombers.

The mayor of the nearby town of Hit, Hikmat Juber, said many of the hostages were government officials working on the second floor of the building.

Gunmen also attacked the home of the police chief in the town of al-Dolab about 10 miles (16 kilometers) away from al-Baghdadi, said Lt. Col. Mohammed Ismail of the Anbar police media office. He said three gunmen were killed when they tried to storm the house, which is located near the town’s police station.

Al-Fahdawi confirmed that attack and said two of the police chief’s guards were also killed. He said two gunmen were arrested.

Violence in Iraq is nothing like it was in 2006 or 2007 when the insurgency was at its most vicious. But militants have demonstrated a dogged persistence in carrying out attacks despite repeated crackdowns by U.S. and Iraqi forces.

Anbar is Iraq’s largest province and the desert area is mostly home to Sunnis. The province has been a hotbed of Iraq’s insurgency for years. Sunni militants aligned with terror groups such as al-Qaida often attack the local police and military, whom they see as traitors and supporters of the Shiite-led government.

Under a 2008 agreement, all American forces must leave Iraq by the end of this year, although U.S. and Iraqi officials have been discussing retaining a small U.S. military presence into 2012. There are currently about 43,000 troops still in the country.

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Associated Press writers Mazin Yahya and Saad Abdul-Kadir contributed to this report.

Source

October 1, 2011

Horror show: the European debt crisis

Filed under: Uncategorized, term — Tags: , , , — Silver @ 11:28 pm

Halloween is around the corner. So let’s conjure up a scary story.

This being a financial column, the gremlins in our tale won’t suck your blood. They’ll drain your 401(k) instead.

We’ll call our story Lehman II: With a Vengeance (and a Greek accent).

The 2008 prequel, as you’ll recall, started with the collapse of the Lehman Brothers investment house. That sent a nervous financial system into full panic, paralyzed credit, erased half the value of the stock market and deepened the Great Recession.

That movie took place in New York. The evildoers in our sequel will devour the European economy, before leaping the Atlantic.

Like all good sci-fi, we’ll start with fact before spinning off into plausible fantasy. Scene One will open with news clips of rioting Greeks, mad as hell about having to pay their debts.

Then we’ll show anguished French bankers wringing their hands over all the money they have in Greek bonds. Germans will shout “Nein!” to bailing out Greeks.

Next, a gray eminence of the financial system, his face bathed in creepy shadow, will intone that Doom is Nigh.

That’s all pretty factual. Right now, the European financial system is giving off signs of the apocalypse.

There’s an under-the-table run on European banks. American money-market mutual funds, long a main source of dollar funding for the Europeans, are fleeing the Continent. Other sources of bank funding are getting clunky or drying up.

There’s a run on the bonds of Spain and Italy, too, even though those two countries are quite solvent.

Worldwide, money is running for safety, mainly to the U.S. dollar. All that money is driving yield on the 10-year Treasury bond to the lowest levels since the 1940s. The euro is down 8 percent against the dollar since August. The Chinese yuan is weakening.

The American stock market is bouncing up and down, lately in synch with news from Europe. The memory Lehman Brothers haunts Wall Street.

In every good scary movie, there’s a scene in which the audience knows more than the characters. We know the devil is lurking in the cellar, but the cute teenagers wander clueless through the house. As they get close to the cellar door, we want to yell, “Don’t go there!”

Right now, financial officials in America, Canada and elsewhere are yelling at Europe. Treasury Secretary Timothy Geitner, the gray eminence of our tale, is warning of a “threat of cascading default, bank runs and catastrophic risk.”

In other words, “Don’t go there!”

True to the genre, European leaders are behaving like fickle teens. They’re arguing over who should bail out the Greeks, Portuguese and Irish. Not us, say the rich northern nations. Yes, you, says all Southern Europe, and America too.

Some German politicians are acting like the Bush administration when it refused to bail out Lehman in 2008. No bailouts for the irresponsible, they said. We know what happened next.

The European Central Bank is fighting, not the last war, but the war before that. It’s still fixated on the memory of hyperinflation in the Weimer Republic after World War I, when the danger now is an economy-eating meltdown.

Here’s how the plot might pan out. The Greeks, burdened by debts they can’t possibly repay, default. Greek banks, which hold lots of that debt, fail and depositors lose their money. Bank depositors in other weakling nations, Ireland and Portugal, see that and run to their own banks to pull money out. Those banks fail, putting pressure on Spanish and Italian banks. French banks, strong enough to withstand a Greek default, can’t stand a Spanish and Italian collapse. Everybody wonders who’s next. There comes a full-blown panic and credit freeze, bringing on a deep recession in Europe.

This hops the Atlantic in several ways. American banks have little exposure to European sovereign debt, but they lend quite a bit to European corporations. Three years after Lehman, derivative investments are still a black hole; no one knows our exposure there. Meanwhile, recession in Europe saps the profit of American internationals.

The upshot: falling American stock prices, tighter credit, a return to mild recession in the U.S., although nothing as bad as in Europe. Our banks, after all, are a lot stronger than they were in 2008.

What are the chances of our scary story coming true?

About 20 percent, says Paul Christopher, chief international investment strategist at Wells Fargo Advisors in St. Louis. He’s betting on sweet reason.

Despite all the caterwauling, he thinks Europe will give Greece the next payment in its bailout this month, putting off the crisis for another three months or so.

But the Greeks eventually will default. The trick will be to handle that in a way to prevent our movie from coming true.

That means pumping capital into the banks now so they can take any hit, while putting together a standby bailout fund in case things get further out of hand. Europe is assembling a $594 billion fund, but it probably needs to be $1 trillion.

The German Bundestag, after a big argument, voted to OK the smaller bailout figure last week. But to do anything in the eurozone requires 17 nations to agree.

Christopher thinks the nervous markets will force their hand over the next few months. That means a volatile time for investors until the final deal is struck.

Across town at Edward Jones, market strategist Kate Warne also thinks Europe will come to its senses. “They all see that the alternative is much worse,” she says.

They all remember Lehman. “No one wants to live that movie again. We want the movie to end differently,” she says.

Source

September 23, 2011

Asia markets sharply lower as recession fears soar

Filed under: news, term — Tags: , , , — Silver @ 10:00 pm

Asian stocks faced sharp losses early Friday following a precipitous session of trading of Wall Street sparked by fears that a global recession may already be under way.

Hong Kong’s Hang Seng index fell 2.3 percent to 17,493.07, a day after tumbling nearly 5 percent. South Korea’s Kospi plunged 4.8 percent at 1,713.56.

Australia’s S&P ASX 200 fell 1.4 percent to 3,909.5. Markets in Japan were closed for a public holiday.

Investors headed for the exits Thursday as they gave in to fears that a global recession was already under way. Selling started in Asia, picked up speed in Europe and sent Wall Street near its worst finish of the year.

The Dow Jones industrial average fell 3.5 percent to close at 10,733.83. It was the second consecutive rout in the stock market since Wednesday afternoon, when the Federal Reserve announced a change in strategy for fighting the economic slowdown _ a bid to lower long-term interest rates and get people and companies to spend more money.

The Standard & Poor’s 500 index, a broader measure of the stock market, and the Nasdaq composite, which is more heavily weighted with technology stocks, both fell more than 3 percent for the day.

Economic news was bad around the world. A closely watched survey in Europe indicated a recession could be on the way there, and a manufacturing survey suggested a slowdown in China, which has been one of the hottest economies.

Volatility has been exacerbated by investors who find themselves outside their “comfort zones,” according to Sean Darby, equity strategist at Jeffries Hong Kong Ltd.

“The low incidence of sovereign defaults and banking crises until 2008 created a false sense of security amongst investors that this was the ‘norm’. In reality, the global economy tends to experience long periods where countries are in default,” Darby wrote in a report.

The Fed announced Wednesday that it would shuffle $400 billion of its own holdings in hopes of reducing interest rates on long-term loans, a plan known as Operation Twist. The central bank hopes that if people and businesses are able to borrow money more cheaply, they will spend throughout the economy and give it a lift.

Still, the Fed announcement troubled investors because it came with a bleak assessment of the future. The Fed said it sees “significant downside risks to the economic outlook,” including volatility in overseas markets.

Asian stocks were hammered to start the world’s trading. The Nikkei index in Japan fell 2.1 percent. The main stock averages fell 2.8 percent in China, 2.9 percent in South Korea, 2.6 percent in Australia and almost 5 percent in Hong Kong.

Europe fared even worse. The stock market fell 5.3 percent in France, 5 percent in Germany and 4.7 percent in Britain.

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