Economy News - part 6
ECONOMY August 24, 2011 | 9:15 AM
- ECB buys government bonds to ease eurozone debt crisis
- ECB total spending of government bonds now €110.5 billion
- Obama and Merkel meet to discuss financial crisis
The European Central Bank has purchased €14.3 billion, or $20.5 billion, in government bonds last week in an attempt to soften the blow from the debt crisis that lingers over Italy and Spain. The ECB has yet to release information regarding which government bonds it had purchased.
A week earlier, the ECB bought €22 billion in bonds for Italy and Spain. The ECB has purchased roughly €110.5 billion in bonds since the launching of the Securities Markets Program in May 2010.Read more »
ECONOMY August 22, 2011 | 3:51 PM
- Forecasts predict inflation rate of 2.6% for 2011
- ECB slowly purchases European bonds from secondary markets
- ECB's Stark warns against common eurobond, low interest rates
The European Central Bank has announced that forecasters are now expecting higher rates of inflation at roughly 2.6% for the year and 2% for next year, up from the 2.5% for 2011 and 1.9% for 2012 predicted three months ago.
Economic growth figures have also been upgraded from 2.5% to 2.6% for the year. The ECB has also adjusted next year's growth figures, which have been downgraded from 1.7% to 1.6%.Read more »
ECONOMY August 12, 2011 | 12:00 PM
- 14,000 or 32% of London's financial industry looking for jobs
- Banks cutting thousands of jobs, creating jobs abroad
- LSBF offers new Trium program, guarantees full-time job in 6 months
Vacancies for financial jobs in London dropped 11% in July to 4,800 from 5,400 in June. The number of individuals within the industry seeking work reached over 14,000, or 32%.
Unemployment is being pushed up due to the growing number of firms cutting jobs. In fact, many european banks and security firms - including UBS, HSBC, Credit Suisse, Barclays and the Royal Bank of Scotland - are all eliminating thousands of jobs in an effort to cut back after reported declines in returns on investment banking.Read more »
ECONOMY August 10, 2011 | 12:47 PM
- China unable to create stimulus package to buffer local, global economies
- China's annual inflation was 6.5% in July
- Premier Wen seeks global cooperation, responsible policies
As the US credit rating downgrade peaked yesterday, concerns are high that the US and European debt crisis might lead to a global double-dip recession.
If so, this time around China may not be in a position to carry the global economy on its shoulders the way it did when it created a stimulus package to buffer the local and international economies. China's annual inflation rate increased to 6.5% in July, while the country's industrial output is growing more slowly than expected.Read more »
ECONOMY August 8, 2011 | 5:46 PM
- Voluntary bond exchange to be completed quickly
- IIF estimates a 90% adoption rate for bond swap, while critics say investors unlikely to embrace it
- Moody’s downgrades Greece to rating just above default
Last week, Euro zone leaders agreed on a wide-ranging new rescue package for Greece, designed to help the country slash its debt. The latest financial aid plan for Greece, which is set up to restructure the country’s bailout and debt, includes a swap of government bonds for longer maturity.
The bond exchange will give banks the option to swap Greek debt with new bonds that have maturities of up to 30 years. It was agreed at a Euro zone summit last week that Greece’s private-sector creditors will take a 21% loss on their bond holdings as part of a €37 billion contribution to the country’s latest bailout plan.Read more »
ECONOMY August 4, 2011 | 10:41 AM
- Nearly 4,000 Federal Aviation Administration workers remain on involuntary unpaid leave
- Essential Air Service program costs government almost $200 million a year
- Airline tax revenue lost during shut-down could add to $1.2 billion
The US Senate began its summer recess on Tuesday August 2 without breaking the Federal Aviation Administration's (FAA) funding deadlock. The current stalemate leaves 4,000 FAA workers spanning 35 states on prolonged furlough.
The ongoing budgetary dispute began with an effort to slash federal deficit that targeted rural air service subsidies. The Essential Air Service program represents government spending of about $200 million annually, says the New York Times, to subsidize commercial flights to 150 rural airports throughout the US.Read more »
ECONOMY July 26, 2011 | 3:56 PM
- Thousands of miners striking in South Africa, Chile and Australia for higher pay and better working conditions
- Coal, oil, metal and diamond industries affected
- Stoppages cause petrol shortage, coal stockpiles
Tens of thousands of angry workers in South Africa's coal, oil, metal and diamond industries are demanding higher pay as strikes surge in Australia and Chile. Roughly 30,000 coal workers for Xstrata, Optimum Coal Holdings, Anglo American Thermal Coal and Exxaro Resources stopped working two days ago after wage talks failed.
South Africa's National Union of Mineworkers (NUM), which is the country's largest labor union, has demanded a pay raise of 14% for their workers. Oil workers have been on strike since July 11 after an unsuccessful demand for an increase in pay of at least 10%. Talks with fuel employers have resumed after gas stations for Royal Dutch Shell ran dry.Read more »
ECONOMY July 4, 2011 | 5:26 PM
- Greece spiraled into debt over a ten-year period
- Government spending skyrocketed 87% between 2004 and 2010
- Greek implements austerity measures to meet EU-IMF demands
Since the late 1990s, Greece has ventured into the furthermost realms of debt and watched its economy plummet. In 2009, just eight years after joining the Euro zone, Greece's national debt climbed to nearly 12.7% of GDP, leaving it no other option but to take a combined bailout of €80 billion from the EU - and another €30 billion from the US last year.
Greece’s joining the Euro zone afforded the country the ability to borrow at low interest rates. This, combined with lax EU implementation of rules to cap debt, allowed Greece’s external debt to soar.Read more »
ECONOMY July 1, 2011 | 4:24 PM
- Poor in Venezuela spending nearly 45% of income on food
- Food prices have risen 33% in Venezuela compared to 7% in other areas
- Price rises linked to overspending and other governmental problems
Rising food prices are causing people in Venezuela to reduce spending on food or buy alternate, cheaper foods.
The country has an inflation rate of nearly 23%, and food prices are rising faster than salaries. Although some people in Venezuela are shopping at subsidized shopping markets that are run by the state, they have to deal frustrating long lines.Read more »
ECONOMY June 30, 2011 | 5:27 PM
- Christine Lagarde poised to begin five-year term as IMF chief starting July 5
- Developing nations criticize IMF unwillingness to pick from outside EU
- DSK scandal leaves IMF vulnerable to credibility attacks
French Finance Minister Christine Lagarde has been appointed Managing Director of the International Monetary Fund (IMF) by its 24-member Executive Board, representing the organization’s 187 member states. July 5 will mark the beginning of her five-year term.
Lagarde had lobbied for the support of Indonesia, Egypt and the United Arab Emirates to reinforce her candidacy. Lagarde, the IMF’s first female chief, was endorsed by the Obama administration just hours before the Board came to their decision and was equally backed by Europe, China and Russia.Read more »