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Nov
23
More financial woes to come
Filed Under Economy, News | Leave a Comment
Washington reports that most International Monetary Fund economists (IMF) have issued grave warnings with regard to the worsening global financial crisis. According to reports, global financial issues have only just begun and the worst is yet to come. Chief economist, Olivier Blanchard states that the crisis is expected to worsen by the year 2010. He also said that a lot of time would be required for things to return to normalcy. Predicting the staus of the situation, he mentioned that economic growth might not hit the globe until the year 2010.
With a promise to help growing economies, Blanchard has maintained that the IMF will try its best to help countries like Iceland, Hungary, Ukraine, Serbia and Pakistan. While it might not be able to solve all financial issues, it has urged countries to help with the problems of liquidity. After having spent almost a fifth of its $ 250 billion fund recently, the IMF has requested banks to lower their interest rates to help save the situation.
Nov
23
Global Recession may stay
Filed Under Economy, News | Leave a Comment
A six percent fall in Asia has tremendously pressed world stocks to their lowest since the last five years. With oil rates dipping below $51 (Rs2,575) fears of the ugly global recession could prove to be even worse.
There are speculations that most central banks may react in the positive light, nothing great can expected too soon. Moreover, the US treasury has also depicted an all-time low over the past two years and regional bonds would perhaps be the only means of hope in facing the market turbulence.
Bracing the storm are the investors who are putting up a brave front despite the fall of exports and bearish signals of the global economy. Oil has fallen to its lowest since January 2007 that had barely hit a high record of $147 a barrel in July 2008.
From auto makers to chip makers to banks everybody across the globe has accepted that the world is in for a prolonged global recession. With other ideas on the rise to bring back the lilting economy, there are several countries that are looking up for investments in precious metals to help them survive
Nov
20
Jerry Yang to quit Yahoo
Filed Under News | Leave a Comment
Yahoo founder, Jerry Yang has decided to call it quits after anchoring it for 14 years. Although he still hopes to cling on, Yang felt the need for shifting base after his phobia of Microsoft. As the story unfolds, Yang had refused to sell Yahoo to Microsoft for $47.5 billion; an event that had taken place six months ago. He felt at the time that the company was being undervalued and instead took to striking up deals with arch rivals, Google.
With the company at an all time low, he had reason to worry as the company’s share prices had hit an all time low. According to latest update, Yahoo shareholders would expect the next chief executive to slice a beneficial deal with Microsoft in an urge to survive.
For the moment of course Yang will remain the titular head Yang, with the profile of “Chief Yahoo,” and will also remain on Yahoo’s board of directors.
Nov
8
Walt Disney Profits Fall by 13%
Filed Under Finance | Leave a Comment
Entertainment conglomerate Walt Disney Co reported that its quarterly profit fell 13% owing to a combination of bad financial decisions and less successful films at the box office.
Walt Disney announced its fourth fiscal results on Thursday which revealed that its profits had come down to $760 million or 40 cents a share in the quarter from a profit of $877 million or 44 cents a share in the same quarter previous year. Revenue however rose 6% to $9.45 billion on improved performance from the company’s cable business as well as theme parks. According to analysts polled by FactSet Research, the company’s profits had been forecast at 49 cents a share on sales of $9.31 billion.
Walt Disney officials revealed that the decline in profits were mainly due to a $91 million bad debt charge on a payment due from financial services firm Lehman Brothers which went bankrupt in September and in the process triggered off a financial meltdown of global proportions.
Chief Executive of Walt Disney Bob Iger said at a conference call that the general slowdown in the economy had also played a major role in the decline of the company’s profits. With shrinking spending power, consumers were cutting down on entertainment expenses and thus bookings at Disney’s theme parks and entertainment venues had fallen considerably over the past month.
Nov
8
Surge of Text Messages Sent on Election Night
Filed Under News | Leave a Comment
Three of the four major wireless carriers in US reported at least a ten percent surge in text messaging on the night the country elected its newest president.
AT&T said on Thursday that on election night it witnessed the largest jump in text messaging in the company’s history as traffic jumped by 44%. Sprint too claimed that there was at least a 30% surge in text messages sent in LA County between seven and nine on election night. According to Sybase 365, another provider of mobile messaging service, the number of text messages sent shot up by three times the normal level during the ten minutes after West Coast polls closed and TV channels declared Barack Obama the winner of the presidential elections.
The surge in text messaging that occurred on election night can be put in perspective when compared to the rise in text messages sent on other important occasions. While AT&T reported messaging services peaking by 44% on election night, in comparison last year’s Christmas saw a 30% spike in traffic while Valentine’s Day witnessed a marginally better 33% boost. Last New Year’s Day however saw a slightly more modest 26% rise in text messaging service.
The interesting phenomenon perhaps can be seen as marking a fitting end to a presidential campaign that made innovative use of text messaging services as an effective campaign strategy.
Nov
8
Most US retailers reported double digit declines in sales on Thursday for the month of October even as the industry geared up for the crucial holiday shopping season, just days away.
The fall in October sales figures come after a lack-luster September and predict a holiday shopping season that might see some of weakest numbers in recent times. This is mainly because of restricted consumer spending which marked the steepest decline in the last seventeen year when it fell 3.1% in the third quarter.
The retail industry is also anticipating further bad news on Friday when the Labor Department comes out with the employment figures which many expect will reveal thousands of jobs lost in the past month. Job cuts are especially detrimental to retail activity since it restricts the spending power of consumers.
Another trend obvious in the retail figures of October revealed that the economic downturn had affected the entire spectrum of retailers, from the luxury stores to the discount outlets. On the higher end, luxury department chain Neiman Marcus reported the steepest drop - 27.3% - while others to experience two-digit sales decline were Abercrombie & Fitch, Gap, Nordstrom. Among the discount stores the main retailers to be affected were Costco, Big Lots, Target, Ross Stores, T.J.Maxx and others.
Nov
7
The days of dizzying Wall Street salaries seem to coming to an end in the wake of the recent market meltdown which has left several finance giants either bankrupt or seeking the refuge of federal bail out.
A study conducted by the consulting firm Johnson Associates reports that bonus for Wall Street executives which had soared to record peaks in recent years are set to drop by 20 to 35 percent across the industry. Bonuses for the top managerial level are in fact estimated to plunge as much as by 70 percent. Another report released in the New York Assembly on Wednesday said that Wall Street bonuses could come down by a whopping 41.3 percent next year.
The Johnson study is based on a survey of banks and money management forms and also takes into account compensation figures disclosed in corporate filings. The study is conducted every year by the private consulting firm but this year it will be especially scrutinized as pressure mounts from political quarters on the finance industry to pare down salaries and bonuses.
The Attorney General of New York Andrew M Cuomo said in an interview on Wednesday that even if executive bonuses are slashed by 70 percent, it might not be enough to cope with the extent of losses which have necessitated a $700 billion federal bail out plan.
Nov
7
Barack Obama’s historic victory in the US presidential elections proved to be lucrative occasion for the struggling newspaper industry as the day’s editions were grabbed up by buyers and major newspapers struggled to keep pace with the demand.
People who missed November 5th’s edition during the day could find them later online but at a high price. By Wednesday evening around 800 sellers were offering newspaper copies - proclaiming Obama’s historic win - for sale at the popular online auction site eBay. According to a report in the online edition of Reuters, bids for The New York Times with its banner headline “Obama” rose to $400 while those for Washington Post proclaiming “Obama Makes History” went up to $41.
At one point major newspapers like Washington Post and The New York Times found out that they had run out of copies due to the surging demand and were then led to put out commemorative editions to cope with the growing number of buyers. Likewise newspapers in Denver, San Francisco and Chicago reported selling out within a brief span of time and had to print special editions. Thousands of extra copies were also brought out cities like Baltimore, Connecticut, Hartford and Orlando, Florida.
The heavy demand for newspaper copies reporting the historic event comes at a time when newspaper industry in the US is struggling with falling advertisement revenues and is even being forced to scale down operations.
Nov
6
ArcelorMittal posted lower-than-expected profits and doubled production cuts as the impact of a global economic slowdown did not spare even the largest steelmaker in the world.
Third quarter income of the Luxembourg-based steel giant rose by 29% to $3.82 billion or $2.78 a share thus falling significantly below the estimate of $8.7 billion forecast by six analysts. Sales rose by 38% to $35.2 billion.
However ArcelorMittal announced that it would cut global output by around 30% in an attempt to support prices. Output of flat carbon steel is expected to fall by over 35% in United States and by more than 30% in Europe which constitute two of the biggest markets for the steel company. The cuts are expected to continue till early 2009, according to the chief financial officer of the company, Aditya Mittal.
Along with production cuts, ArcelorMittal also announced that it was lowering it fourth quarter forecast earnings by as much as 48% to $2.5 billion. The lowering of future profits and the slash in output comes at a time when the global economic slowdown has led to declining demand from both builders and auto makers. With this ArecelorMittal joins its competitors from Russia, South Korea and Japan in curtailing production only a couple of months after steel prices touched record highs.
Nov
5
Global Markets Trade Cautiously as US Votes
Filed Under Stocks | Leave a Comment
Stock markets in Asia and Europe gave mixed performances on Tuesday in a cautious response to the presidential elections taking place in United States on November 4.
While the Wall Street closed with a relatively flat finish ahead of the US presidential elections, stock markets across the world traded cautiously as everyone waited to see who would win the race to the White House.
Japan’s market opened positively after it was closed on Monday for a national holiday and Tokyo’s Nikkei 225 index gained 538 points or 6%. Hong Kong’s Hang Seng Index added 0.3% to 14,384 after fluctuating throughout Tuesday and South Korea’s Kospi rose by 2%. however benchmark indices in Shanghai and Singapore fell and in mainland China the market dropped for the third day led by mining and metal stocks.
Australia’s S&P/ASX 200 index shook off initial losses to close almost flat after the country’s central bank slashed key interest rates by 0.75 of a percentage point, exceeding most analysts’ estimates of a half-percentage point. The Australian Reserve Bank cut interest rates amidst recent data pointing to growing evidence of an economic slowdown in the country.
Stock markets across the world have gone through some of the most chaotic times in past few weeks as the impact of the global financial crisis eroded investors’ confidence.
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