The weekly newsletter sent out on Friday by Fathom, a London-based economic consultancy, said it all. “It’s getting really ugly out there,” it said. “It may be true that we have passed the first phase of this crisis, but that does not mean the next phase will not be worse, perhaps very much worse.”
The investors reading those dire warnings will already have spent their week seeing a heap of evidence piling up that the economic crisis is spreading around the world. Record after grim record was broken in the financial markets, as long-term interest rates sank to their lowest for decades, in some cases their lowest ever.
Any lingering hopes that some parts of the world economy, particularly the fast-growing emerging markets such as China, would remain immune to the crisis were snuffed out. With remarkable speed in the past two months, a worrying but apparently manageable credit crunch has turned into a global financial crisis and a recession across much of the world’s economy.
Senator Hillary Clinton has accepted Barack Obama’s offer to become US Secretary of State, as the president-elect moved at rapid speed to assemble an all-star cabinet amid steep challenges at home and overseas.
Mrs Clinton, 61, had been uncertain if she should give up her Senate seat to join Barack Obama’s staff Photo: GETTY
Friends of the former First Lady told American news organisations that she had firmly decided to give up her seat as a senator for New York and become the international face of the man who thwarted her presidential ambitions in a long and sometimes bitter battle for the Democratic Party’s nomination.
Other reports said Mr Obama will nominate Timothy Geithner, 47, as his Treasury Secretary. As head of the New York federal reserve bank he has been involved with the $700 billion bail-out of Wall Street, which he will take charge of if confirmed.
As a former treasury official, Mr Geithner has invaluable Washington experience and will be considered a wise choice. Stocks soared as news of his appointment reached Wall Street.
He will probably be joined around the cabinet table by Bill Richardson, the New Mexico governor, who has been reportedly selected as commerce secretary after losing out to Mrs Clinton as secretary of state, the most prestigious job beneath the presidency.
THEY sit parked in rows stretching as far as the eye can see, destined for a prolonged battering from the wind and rain as the global economic turmoil stalls sales. The world’s carmakers are also going nowhere fast, some teetering on the brink as they seek massive bail-outs to stay in business.
Britain’s manufacturers felt the chill yesterday, with Honda announcing a two-month halt to production at its Swindon plant from February.
It came as BMW’s Mini factory in Oxford closed for three days ahead of an extended Christmas break because of falling sales.
In a further sign of the gloom enveloping the industry, car production fell by a quarter last month to the lowest level for 17 years. Commercial vehicle making sank even further, down by 41 per cent.
Buyers, nervous about their financial security, are deserting the showrooms, with the trade in Scotland suffering its largest drop in sales last month since the early 1990s. Registrations plunged by 26 per cent to 10,190 compared with October last year.
Advocates Call for Immediate Ban of All GM Foods and GM Crops
(Los Angeles, CA.) – A long-term feeding studycommissioned by the Austrian Agency for Health and Food Safety, managed by the Austrian Federal Ministry of Health, Family and Youth, and carried out by Veterinary University Vienna, confirms genetically modified (GM) corn seriously affects reproductive health in mice. Non-GMO advocates, who have warned about this infertility link along with other health risks, now seek an immediate ban of all GM foods and GM crops to protect the health of humankind and the fertility of women around the world.
Feeding mice with genetically modified corn developed by the US-based Monsanto Corporation led to lower fertility and body weight, according to the study conducted by the University of Veterinary Medicine in Vienna. Lead author of the study Professor Zentek said, there was a direct link between the decrease in fertility and the GM diet, and that mice fed with non-GE corn reproduced more efficiently.
In the study, Austrian scientists performed several long-term feeding trials over 20 weeks with laboratory mice fed a diet containing 33% of a GM variety (NK 603 x MON 810), or a closely related non-GE variety used in many countries. Statistically significant litter size and pup weight decreases were found in the third and fourth litters in the GM-fed mice, compared to the control group.
The corn is genetically modified with genes that produce a pesticidal toxin, as well as genes that allow it to survive applications of Monsanto’s herbicide Roundup.
Rich governments and corporations are triggering alarm for the poor as they buy up the rights to millions of hectares of agricultural land in developing countries in an effort to secure their own long-term food supplies.
The head of the UN Food and Agriculture Organisation, Jacques Diouf, has warned that the controversial rise in land deals could create a form of “neo-colonialism”, with poor states producing food for the rich at the expense of their own hungry people.
Rising food prices have already set off a second “scramble for Africa”. This week, the South Korean firm Daewoo Logistics announced plans to buy a 99-year lease on a million hectares in Madagascar. Its aim is to grow 5m tonnes of corn a year by 2023, and produce palm oil from a further lease of 120,000 hectares (296,000 acres), relying on a largely South African workforce. Production would be mainly earmarked for South Korea, which wants to lessen dependence on imports.
“These deals can be purely commercial ventures on one level, but sitting behind it is often a food security imperative backed by a government,” said Carl Atkin, a consultant at Bidwells Agribusiness, a Cambridge firm helping to arrange some of the big international land deals.
Wall Street ended a volatile week with renewed confidence last night, after reports that Barack Obama has chosen Timothy Geithner, the head of the New York Federal Reserve, as his treasury secretary.
As speculation mounted over Geithner’s nomination, shares rebounded. The Dow Jones industrial average recorded a 494-point gain on the day as stocks surged by 6.5% to close above the psychologically important 8,000 level at 8046.42. It was still 5% down for the week, however, as worries persist about the global economic slowdown.
Geithner, 47, has always been a favourite to take the top job and his appointment is expected to be announced by the Obama camp in the next 24 hours.
Banking stocks still suffered, though, despite the market’s abrupt recovery.
Citigroup, once the world’s biggest banking group, saw another $5bn (£3.35bn)wiped off its value after an emergency board meeting failed to come up with any initiative to stem the unprecedented flight of investors. Shares fell to $3 after the bank’s chief executive, Vikram Pandit, ruled out selling its retail stockbroking arm, Smith Barney, in an attempt to stop the rout.
Shares in Citigroup have lost more than half their value this week since Pandit announced plans on Monday to sack 52,000 workers. Measures by the bank and its biggest investors to reverse the share price decline, from a level of $54 two years ago, have all failed.
However, a Citigroup source within Pandit’s inner circle, defended the bank last night, saying the sinking share price “has nothing to do with our viability”. The source added that it was of no consequence if the price fell to zero. (Obviously an expert!…)
“This is all about market perception,” she said, claiming that the market was wrong. “We are the same as everybody else. Our stock price is declining but so is everybody else’s.” (…and a great observer too!)
“U.S. President-elect Barack Obama says he wants to focus more on the Afghan war and plans to persuade other nations to send more soldiers.”
More ‘change’. The soldiers have been strongly supporting Ron Paul and they exactly knew why! ___________________________________________________________________________
A British military vehicle drives past an Afghan man in Lashkar Gah, capital of Helmand province October 20, 2008.
CORNWALLIS, Nova Scotia (Reuters) – The Pentagon is considering a plan to send more than 20,000 troops to Afghanistan over the next 12 to 18 months to help safeguard elections and quell rising Taliban violence, officials said on Friday.
U.S. Defense Secretary Robert Gates said he and top commanders had discussed sending five brigades to Afghanistan, including four brigades of combat ground forces as well as an aviation brigade, which a defense official said would consist mainly of support troops. An Army combat brigade has about 3,500 soldiers.
Gates said much of the infusion could take place before Afghanistan holds elections by next autumn.
Nov. 22 (Bloomberg) — Seizure and sale of Downey Financial Corp. and two smaller lenders may cost the FDIC more than $2 billion as foreclosures rise and home prices extend declines in the worst housing slump since the Great Depression.
U.S. Bancorp acquired Downey and smaller PFF Bank & Trust, California thrifts crippled by bad mortgages, yesterday in a deal brokered by the Federal Deposit Insurance Corp. Community Bank of Loganville, Georgia, was also closed and its $611.4 million of deposits taken over by Bank of Essex in Tappahannock, Virginia.
Regulators this year have closed the most banks since 1993 as mortgage defaults and tightening credit froze markets. The collapse of IndyMac Bancorp Inc. was among the biggest in history, costing the FDIC $8.9 billion. The agency expects Downey’s demise to deplete its Deposit Insurance Fund by $1.4 billion, with PFF costing $700 million and Community $240 million.
WASHINGTON: Federal regulators will guarantee as much as $1.4 trillion in U.S. banks’ debt in a bid to get the distressed financial system pumping again. They also took steps to make it easier for private investors to buy failed banks seized by the government.
Against a bleak economic backdrop, news that New York Federal Reserve President Timothy Geithner is President-elect Barack Obama’s choice for Treasury secretary gave battered Wall Street a shot in the arm Friday. The Dow Jones industrials zoomed nearly 500 points as stocks erased roughly half the losses racked up the prior two days. Investors have been seeking a clear message from Obama on who will lead his economic brain trust during the financial crisis.
Directors of the Federal Deposit Insurance Corp. voted to approve the bank-debt guarantee program, which is part of the government’s financial rescue package. The FDIC program is meant to break the crippling logjam in bank-to-bank lending by guaranteeing the new debt in the event of payment default by the borrowing bank.
Some analysts have said that freeing up bank-to-bank lending with the guarantees won’t necessarily translate into a thaw in broader lending as banks are still wary of making loans to businesses and consumers.
Activists note that most of the candidates for top security posts voted for the 2002 resolution authorizing President Bush to invade Iraq or otherwise supported launching the war. Reporting from Washington — Antiwar groups and other liberal activists are increasingly concerned at signs that Barack Obama’s national security team will be dominated by appointees who favored the Iraq invasion and hold hawkish views on other important foreign policy issues.
The activists are uneasy not only about signs that both Sen. Hillary Rodham Clinton (D-N.Y.) and Defense Secretary Robert M. Gates could be in the Obama Cabinet, but at reports suggesting that several other short-list candidates for top security posts backed the decision to go to war.
“Obama ran his campaign around the idea the war was not legitimate, but it sends a very different message when you bring in people who supported the war from the beginning,” said Kelly Dougherty, executive director of the 54-chapter Iraq Veterans Against the War.
The activists — key members of the coalition that propelled Obama to the White House — fear he is drifting from the antiwar moorings of his once-longshot presidential candidacy. Obama has eased the rigid timetable he had set for withdrawing troops from Iraq, and he appears to be leaning toward the center in his candidates to fill key national security posts.
The president-elect has told some Democrats that he expects to take heat from parts of his political base but will not be deterred by it.
Aside from Clinton and Gates, the roster of possible Cabinet secretaries has included Sens. John F. Kerry (D-Mass.) and Richard G. Lugar (R-Ind.), who both voted in 2002 for the resolution authorizing President Bush to invade Iraq, though Lugar has since said he regretted it.
“It’s (absolutely not) astonishing that not one of the 23 senators or 133 House members who voted against the war is in the mix,” said Sam Husseini of the liberal group Institute for Public Accuracy.
More ‘change’ coming.
Hillary Will Get SOS Nom Soon
CBS News has learned that President-elect Barack Obama will nominate Clinton to be his Secretary of State right after Thanksgiving, reports Bill Plante.
(CBS/ AP) President-elect Barack Obama is on track to nominate Hillary Rodham Clinton as secretary of state, an aide to his transition said Thursday.
CBS News has learned that Mr. Obama is likely to make the nomination official after Thanksgiving.
One week after the former primary rivals met secretly to discuss the idea of Clinton becoming the nation’s top diplomat, the two sides were moving quickly toward making it a reality, barring any unforeseen problems.
The transition aide told The Associated Press that the two camps have worked out financial disclosure issues involving Clinton’s husband, former President Bill Clinton, and the complicated international funding of his foundation that operates in 27 countries. The aide said Mr. Obama and Hillary Clinton have had substantive conversations about the secretary of state job.
FEARS of the unknown long-term effects from the global financial crisis have sparked a new gold rush.
With retail and wholesale clients around the world stocking up on the precious metal, the Perth Mint has been forced to suspend orders.
As the World Gold Council reported that the dollar demand for gold reached a quarterly record of $US32 billion ($50.73 billion) in the third quarter, industry insiders said the race to secure physical gold had reached an intensity that had never been witnessed before.
Perth Mint sales and marketing director Ron Currie said the unprecedented demand had forced the Mint to cease orders until January, with staff working seven days a week, 24-hour days, over three shifts to meet orders.
He said Europe was leading the demand, with Russia, Ukraine, Middle East and US all buying — making up 80 per cent of its sales. One European client purchased 30,000 ounces for $33 million.
“We have never seen this before and are working right at capacity. And we are seeing it from clients in the shop buying one ounce, right up to 30,000 ounces from overseas clients,” Mr Currie said.
U.S. President-elect Barack Obama looks on before the start of a meeting with Senator John McCain of Arizona, former Republican presidential candidate, at Obama’s transition office in Chicago, Nov. 17, 2008. Photographer: Frank Polich/Bloomberg News
Nov. 21 (Bloomberg) — President-Elect Barack Obama‘s transition team is exploring a swift, prepackaged bankruptcy for automakers as a possible solution to the industry’s financial crisis, according to a person familiar with the matter.
A representative of Obama’s team has already contacted at least one bankruptcy-law firm to say that Daniel Tarullo, a professor at Georgetown University’s law school who heads Obama’s economic policy working group, would call to discuss the workings of a so-called prepack, according to this person.
U.S. lawmakers yesterday delayed until December a vote on whether to give General Motors Corp., Ford Motor Co. and Chrysler LLC a $25 billion bailout. GM today said it would idle production at four plants an extra week and return some corporate jets to conserve cash. Automakers could use a judge-supervised bankruptcy to reduce debt and reject expensive contracts.
“It creates the environment to deal with GM’s problems but limits government financial commitment,” said bankruptcy lawyer Mark Bane of Ropes & Gray in New York.
Bankruptcy is just one option being examined. Obama told CBS News’s “60 Minutes” on Nov. 16 that government aid to automakers might come in the form of a “bridge loan,” advanced if the industry could draw up plan to make itself “sustainable.” The president-elect earlier urged Congress to approve as much as $50 billion to save automakers, using the model of Chrysler’s bailout in 1979.
Timothy Geithner, president and chief executive officer of the Federal Reserve Bank of New York, speaks during an Economic Club of New York luncheon in New York, on June 9, 2008. Photographer: Daniel Acker/Bloomberg News
Nov. 21 (Bloomberg) — U.S. stocks rallied and the Standard & Poor’s 500 Index rebounded from an 11-year low after President-elect Barack Obama picked New York Federal Reserve Bank chief Timothy Geithner to head the Treasury.
“This news could really give the stock market a badly needed shot in the arm,”Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York, wrote in an e-mail to clients. Geithner is a “fantastic choice to help lead the financial markets out of the wilderness.”
Citigroup Inc. pared a 35 percent slide and JPMorgan Chase & Co. trimmed a 16 percent tumble in the final hour as a Democratic aide said Obama will name Geithner to replace Henry Paulson. National-Oilwell Varco Inc. and Chesapeake Energy jumped more than 20 percent as oil rose for the first time in six days. The rally came after this week’s rout dragged the S&P 500’s price-to-earnings valuation to the cheapest since 1995.
Moving on to Plan B “The Winter of 2008-2009 will prove to be the winter of global economic discontent that marks the rejection of the flawed ideology that unregulated global financial markets promote financial innovation, market efficiency, unhampered growth and endless prosperity while mitigating risk by spreading it system wide.” Economists Paul Davidson and Henry C.K. Liu “Open Letter to World Leaders attending the November 15 White House Summit on Financial Markets and the World Economy”
The global economy is being sucked into a black hole and most Americans have no idea why. The whole problem can be narrowed down to two words; “structured finance”.
Turkey is reported to be in negotiations with the International Monetary Fund for a $40 billion loan. Very shortly, the Baltic States and at least a dozen developing countries will be filing for IMF handouts. But how will the venerable lender of last resort fund itself?
According to a fact sheet posted on its website in October, the IMF had $200 million available for emergency loans to the third-world, and another $50 billion in “additional resources”. But the IMF’s liquidity is rapidly dwindling. Between the crisis facilities concluded with Ukraine, Hungary, Serbia, Iceland and Pakistan, and the expected spate of new loan requests, the IMF should be running out of money within the first quarter of next year. Quite simply, unless the rich nations (including American tax-payers) can add to the IMF’s funding capabilities, the global recession will cause unprecedented havoc, chaos, hunger and turmoil in the world’s poverty pockets.
The White House, announcing the meeting with Mr Olmert, gave little indication that Tehran’s nuclear ambitions would be at the top of the agenda
President Bush is to hold White House talks with the Israeli Prime Minister Ehud Olmert on Monday after publication of a nuclear watchdog’s report this week showing that Iran may have stockpiled enough enriched uranium to make a nuclear bomb.
The International Atomic Energy Agency believes that Iran has amassed 630kg of low enriched(=useless) uranium, up from 480kg in late August. Some experts believe this is enough to produce the weapons-grade material needed for a crude nuclear device similar in size to that which America used to destroy the city of Nagasaki at the end of the Second World War.
Sean McCormack, the US State Department spokesman, said: “It’s concerning. This is a matter that will be taken up next week at the IAEA Board of Governors meeting.” Asked if Tehran now had sufficient material to build a bomb, he suggested that there were different opinions. “Some said it was enough; others said it was not enough, but close,” said Mr McCormack. “In any case, you don’t want Iran to get close.”
In its report, the IAEA said that Iran was working hard roughly to double its number of operating centrifuges. European diplomats say that Iran might have 6,000 centrifuges enriching uranium by the end of the year – and plans to install another 3,000 early next year.
An investigation by the agency’s inspector general finds that officials covered up details of the 2001 incident over Peru that killed two Americans and wounded three other people.
Reporting from Washington — An internal investigation by the CIA found that agency officials engaged in a cover-up to hide agency negligence in the downing of a private airplane over Peru in 2001 as part of a mistaken attack on an aircraft suspected of carrying illegal narcotics.
Excerpts of an internal CIA report released Thursday accuse agency officials of lying to members of Congress and withholding crucial information from criminal investigators and senior Bush administration officials.The disclosure could lead to the reopening of a probe into whether agency officials committed crimes in the attack on the aircraft, which was transporting American missionaries, and then covering it up.
The attack killed Veronica Bowers and her infant daughter and injured three others, including Bowers’ husband and young son. It was carried out by a Peruvian warplane working with CIA surveillance craft.
Rep. Peter Hoekstra of Michigan, the ranking Republican on the House Intelligence Committee, described the revelations as “a dark stain” on the CIA and called for information to be shared with the Justice Department to determine whether reopening the investigation is warranted.
“To say these deaths did not have to happen is more than an understatement,” said Hoekstra, who added that the agency’s inspector general had uncovered “continuous efforts to cover the matter up and potentially block criminal investigation.”
Pakistani soldiers practised shooting at pilotless “drone” aircraft on Friday, the military said a day after the government lodged a protest with the U.S. ambassador over drone missile strikes in Pakistani territory.
Anti-aircraft guns and short-range surface-to-air missiles were used during the exercise conducted at a desert range near the city of Muzaffargarh in the central Pubjab province.
“The elements of Army Air Defence demonstrated their shooting skills by targeting the drones flying at different altitudes,” the military said in a statement.
Air defence commander Lieutenant-General Ashraf Saleem praised the “precision and agility” of the gunners.
Pakistan is bristling over a series of missile strikes by U.S. drones targeting al Qaeda and Taliban militants in the lawless tribal regions along the Afghan border in recent weeks.
The U.S. forces have carried out more than 20 such drone attacks in the last three months, reflecting U.S. impatience over militants from Pakistan fuelling the Taliban insurgency in Afghanistan and fears that al Qaeda fighters in northwest Pakistan could plan attacks in the West.
A U.S. commando raid on September 3 led to a diplomatic storm, and there has not been any subsequent incursion by ground troops.
Workers assemble engines of Toyota Motor Corp.’s Lexus LS600 hybrid sedan on the production line at its Tahara plant in Tahara, central Japan, on June 28, 2007. Photographer: Kimimasa Mayama/Bloomberg News
Nov. 21 (Bloomberg) — Toyota Motor Corp., Japan’s biggest carmaker, will cut its domestic temporary workforce by 50 percent as vehicle demand slumps globally.
Toyota will cut the number of temporary workers to 3,000 from 6,000 by the end of March, spokesman Paul Nolasco said today in a phone interview.
The automaker follows Mazda Motor Corp. and Isuzu Motors Ltd., which yesterday said they would slash a combined 2,700 temporary jobs in Japan in response to slowing sales. Earlier this month, Toyota forecast a 68 percent drop in full-year net income, the biggest decline in at least 18 years, as a global recession cripples auto demand.
A sign hangs above the entrance to a Citibank branch at the headquarters of Citigroup Inc. in New York, Nov. 17, 2008. Photographer: Jin Lee/Bloomberg News
Nov. 21 (Bloomberg) — Citigroup Inc.‘s board meets today to discuss the bank’s options after Chief Executive Officer Vikram Pandit‘s efforts to rebuild investor confidence failed to halt the stock’s descent to a 15-year low, a person with knowledge of the matter said.
The board, led by Chairman Win Bischoff and independent director Richard Parsons, will meet at Citigroup’s headquarters in New York, said the person, who declined to be identified because the deliberations are private. The panel may choose to sell pieces of the bank or the entire company, the Wall Street Journal reported, citing unidentified people familiar with the situation. The New York Times reported that management isn’t actively considering a sale or split up of the bank.
Citigroup, once the biggest U.S. bank, with a stock market value of $274 billion at the end of 2006, dropped yesterday to about $26 billion, slipping to No. 5 after Minneapolis-based U.S. Bancorp. A plan Pandit announced this week to cut costs by shedding 52,000 jobs and an endorsement by billionaire Saudi investor Prince Alwaleed bin Talal didn’t assuage shareholders’ concern that bad loans and securities writedowns may extend a yearlong run of net losses totaling $20 billion.
KANSAS CITY, Missouri (Reuters) – People in a vast seismic zone in the southern and midwestern United States would face catastrophic damage if a major earthquake struck there and should ensure that builders keep that risk in mind, a government report said on Thursday.
The Federal Emergency Management Agency said if earthquakes strike in what geologists define as the New Madrid Seismic Zone, they would cause “the highest economic losses due to a natural disaster in the United States.”
FEMA predicted a large earthquake would cause “widespread and catastrophic physical damage” across Alabama, Arkansas, Illinois, Indiana, Kentucky, Mississippi, Missouri and Tennessee — home to some 44 million people.
Tennessee is likely to be hardest hit, according to the study that sought to gauge the impact of a 7.7 magnitude earthquake in order to guide the government’s response.
In Tennessee alone, it forecast hundreds of collapsed bridges, tens of thousands of severely damaged buildings and a half a million households without water.
Wrecked cars are seen outside a damaged building in Wudu town, Longnan city, Gansu province in this video grab from CCTV footage of November 20 released November 21, 2008. REUTERS/CCTV via Reuters TV
BEIJING (Reuters) – The governor of a Chinese province sat down with protesters after they fought pitched battles with police, a rare concession by a leader and a sign of government concerns about stability as the economy slows.
Xu Shousheng held a meeting with 10 representatives in Wudu in the poverty-stricken northwestern province of Gansu two days after the riot in which dozens were injured, state media said.
Minister of Human Resources and Social Security Yin Weimin said on Thursday stabilizing employment was the top priority for China as he revealed a rise in jobless workers triggered by a weakened export sector.
The protests were sparked by local residents’ worries about a government resettlement plan after the May 12 earthquake killed more than 80,000 people, and in Gansu alone made 1.8 million people homeless.
The journey of a thousand miles begins with a single step. – Lao Tzu
A naturally occuring substance that can create “immortal cells” could be the key to finding a real elixir of youth, scientists claim.
Researchers believe boosting the amount of a naturally forming enzyme in the body could prevent cells dying and so lead to extended, healthier, lifespans..
The protein telomerase helps maintain the protective caps at the ends of chromosomes which act like the ends of shoelaces and stop them unravelling.
As we age, and our cells divide, these caps become frayed and shorter and eventually are so damaged that the cell dies. Scientists believe boosting our natural levels of telomerase could rejuvenate them.
A team at the Spanish National Cancer Centre in Madrid tested the theory on mice and found that those genetically engineered to produce 10 times the normal levels of telomerase lived 50 per cent longer than normal.
Nov. 20 (Bloomberg) — U.S. stocks slid and the Standard & Poor’s 500 Index plunged to its lowest level in 11 years after economic reports depicted a deepening recession and lawmakers postponed a vote on a plan to salvage the auto industry.
The Standard & Poor’s 500 Index extended its 2008 tumble to 49 percent, poised for the worst annual decline in its 80-year history. Chesapeake Energy Corp. and National-Oilwell Varco Inc. slid more than 21 percent after oil sank to a three-year low as the slumping economy crushes demand. JPMorgan Chase & Co. lost 18 percent and Citigroup Inc. plunged 26 percent as concern the recession will trigger more bankruptcies pushed the cost of insurance against corporate defaults to an all-time high.
“We’re just trying to stay away from the window,” said James Paulsen, who helps oversee about $220 billion as chief investment strategist at Wells Capital Management Inc. in Minneapolis. “This isn’t about fundamentals, it’s not about bad balance sheets, it’s about fear and confidence.”
Animals and plants in danger of extinction could lose the protection of government experts who make sure that infrastructure projects don’t pose a threat, under regulations outgoing US president George W Bush is set to put in place before he leaves office.
Geogre Bush: opponents claim he will introduce a number of ‘midnight regulations’ before leaving office Photo: AP
The rules must be published on Friday to take effect before President-Elect Barack Obama is sworn in Jan 20.
The proposed change would eliminate the input of federal wildlife scientists in some endangered species cases, allowing the federal agency in charge of building, authorising or funding a project to determine for itself if it is likely to harm endangered wildlife and plants.
Current regulations require independent wildlife biologists to sign off on these decisions before a project can go forward, at times modifying the design to better protect species.
It is among several rule changes that environmentalists say Mr Bush has or will introduce in what are known as “midnight regulations”.
Though he would not be the first president to follow the practice, environmental campaigners fear he will sneak through as many changes as possible on energy, climate change and the environment, having been unable to pass full legislation through the Democrat-controlled Congress.
He has already opened up 800,000 hectares of land in Rocky Mountain states for the development of oil shale, and is reportedly considering allowing industrial-size pig, cow and chicken farms to disregard the Clean Water Act and air pollution controls.
Nov. 20 (Bloomberg) — JPMorgan Chase & Co., the largest U.S. bank, plans to fire about 10 percent of its investment banking staff, or about 3,000 people, as the global economy slides into recession, a person familiar with the bank said.
The reductions are in line with New York-based JPMorgan’s rivals, including Goldman Sachs Group Inc., which said it will eliminate about 10 percent of staff. JPMorgan’s cuts will be global and include various groups within the investment bank, the person said, speaking anonymously because the news isn’t yet public. Some employees at the New York-based firm have been notified.
“There are aggressive cuts going on everywhere,” said Rupert Della-Porta, the London-based chief operating officer of research firm Atlantic Equities. “There are marked differences between business conditions now and the forward views that even the most conservative managers had. JPMorgan has to right-size their business model.”
JPMorgan also plans to freeze base salaries next year for most employees who earn more than $60,000 to $70,000, another person said.Tasha Pelio, a spokeswoman for JPMorgan declined to comment. JPMorgan’s decision to fire employees was reported earlier by the Sunday Telegraph and Reuters.
A missile is launched from the Japan Maritime Self-Defense Force ship Chokai in the Pacific Ocean near Hawaii November 20, 2008. (Japan Maritime Self-Defense Force/Handout/Reuters)
WASHINGTON (Reuters) – A Japanese warship failed to shoot down a ballistic missile target in a joint test with U.S. forces Wednesday because of a glitch in the final stage of an interceptor made by Raytheon Co, a U.S. military official said.
The kinetic warhead’s infrared “seeker” lost track in the last few seconds of the $55 million test, about 100 miles above Hawaiian waters, said U.S. Rear Admiral Brad Hicks, program director of the Aegis sea-based leg of an emerging U.S. anti-missile shield.
“This was a failure,” he said in a teleconference with reporters. It brought the tally of Aegis intercepts to 16 in 20 tries.
The problem “hopefully was related just to a single interceptor,” not to a systemic issue with the Standard Missile-3 Block 1A, the same missile used in February to blow apart a crippled U.S. spy satellite, Hicks said.
Demand for gold smashed the previous record in the three months between July and September as fearful investors switched funds from the stock market and savings into ingots and coins, often storing them at home as their trust in banks fell.
New figures from the World Gold Council (WGC) show that investment demand for gold rose 56 per cent to 382.1 tonnes for the third quarter as investors sought safe havens away from the stock market turbulence.
Dollar demand for gold reached a record of $32 billion (£21 billion) in the third quarter – 45 per cent higher than the previous record, set in the second quarter of this year, according to the data compiled by GFMS, the researcher, for the council.
Pedestrians are reflected in the window of a Citibank branch in Hong Kong’s financial Central District November 18, 2008. REUTERS/Bobby Yip
(Reuters) – The U.S. financial system still needs at least $1 trillion to $1.2 trillion of tangible common equity to restore confidence and improve liquidity in the credit markets, Friedman Billings Ramsey analyst Paul Miller said.
Eight financial companies — Citigroup Inc, Morgan Stanley, Goldman Sachs Group Inc, Wells Fargo & Co, JPMorgan Chase & Co, American International Group Inc, Bank of America Corp and GE Financial — are in greatest need of capital, he said.
“Debt or TARP capital is not true capital. Long-term debt financing is not the solution. Only injections of true tangible common equity will solve the current crisis,” he said in a note dated November 19.
Currently, the U.S. financial system has $37 trillion of debt outstanding, he noted.
Combined, these eight companies have roughly $12.2 trillion of assets and only $406 billion of tangible common capital, or just 3.4 percent, the analyst said in his note to clients.
Miller said these institutions need somewhere between $1 trillion and $1.2trillion of capital to put their balance sheets back on solid ground and begin to extend credit again, given their dependence on short-term funding and the illiquid nature of their asset bases.
One hundred riyal notes at a bank in Riyadh, the Saudi Arabian capital. The US has asked four oil-rich Gulf states for close to US$300 billion to help it curb the global financial meltdown, Kuwait’s daily Al-Seyassah has reported.
KUWAIT CITY (AFP) – The United States has asked four oil-rich Gulf states for close to 300 billion dollars to help it curb the global financial meltdown, Kuwait’s daily Al-Seyassah reported Thursday.
Quoting “highly informed” sources, the daily said Washington has asked Saudi Arabia for 120 billion dollars, the United Arab Emirates for 70 billion dollars, Qatar for 60 billion dollars and was seeking 40 billion dollars from Kuwait.
Al-Seyassah said Washington sought the amount as “financial aid” to face the fallout of the financial crisis and help prevent its economy from sliding into a painful recession.
The daily said the United States plans to use the funds to help the ailing automobile industry , banks and other companies suffering from the global financial turmoil.
Hours after Salon revealed evidence that two Americans were killed by a U.S. tank, not enemy fire, military officials destroyed papers on the men.
Editor’s note: On Oct. 14, 2008, Salon published an article about the deaths of Army Pfc. Albert Nelson and Pfc. Roger Suarez. The Army attributed their deaths in Iraq in 2006 to enemy action; Salon’s investigation, which included graphic battle video and eyewitness testimony, indicated that their deaths were likely due to friendly fire.
Helmet-cam footage from Ramadi, Iraq (12-min. edited version). Warning: Contains graphic violence and profanity.
Nov. 20, 2008 | FORT CARSON, Colo. — Last month, Salon published a story reporting that U.S. Army Pfc. Albert Nelson and Pfc. Roger Suarez were killed by U.S. tank fire in Ramadi, Iraq, in late 2006, in an incident partially captured on video, but that an Army investigation instead blamed their deaths on enemy action.
Now Salon has learned that documents relating to the two men were shredded hours after the story was published. Three soldiers at Fort Carson, Colo. – including two who were present in Ramadi during the friendly fire incident, one of them just feet from where Nelson and Suarez died – were ordered to shred two boxes full of documents about Nelson and Suarez. One of the soldiers preserved some of the documents as proof that the shredding occurred and provided them to Salon. All three soldiers, with the assistance of a U.S. senator’s office, have since been relocated for their safety.
– – – – – – – – – – – –
Oct. 14 was a long and eventful day at Fort Carson. The post had been in an uproar. The night before, Salon had published my article airing claims that two of the base’s soldiers, Pfc. Albert Nelson and Pfc. Roger Suarez-Gonzalez, had been killed by friendly fire in Iraq on Dec. 4, 2006, but that the Army covered up the cause of death, attributing it to enemy action.
Based on the testimony of eyewitnesses, and on video and audio recorded by a helmet-mounted camera that captured much of the action that day, my report stated that Nelson and Suarez seemed to have been killed by an American tank shell. The shell apparently struck their position on the roof of a two-story ferro-concrete building in Ramadi, Anbar province, Iraq, killing Suarez instantly, mortally wounding Nelson, and injuring several other soldiers. I included both an edited and a full-length version of the video in the article. The video shows soldiers just after the blast claiming to have watched the tank fire on them. Then a sergeant attempts to report over a radio that a U.S. tank killed his men. He seems to be promptly overruled by a superior officer who is not at the scene. An official Army investigation then found that the simultaneous impact of two enemy mortars killed the men.
It works 100% of the time to eradicate cancer completely, and cancer does not recur even years later. That is how researchers describe the most convincing cancer cure ever announced.
The weekly injection of just 100 billionths of a gram of a harmless glyco-protein (a naturally-produced molecule with a sugar component and a protein component) activates the human immune system and cures cancer for good, according to human studies among breast cancer and colon cancer patients, producing complete remissions lasting 4 and 7 years respectively. This glyco-protein cure is totally without side effect but currently goes unused by cancer doctors.
An undated handout photo, provided to the media on Thursday, Nov. 20, 2008, shows the Sirius Star Saudi oil supertanker. Source: U.S. Navy via Bloomberg News
Nov. 20 (Bloomberg) — Somali pirates are demanding $25 million in ransom to release an oil-laden Saudi supertanker seized off the East African coast, and called on the ship’s owners to pay up “soon.”
“What we want for this ship is only $25 million because we always charge according to the quality of the ship and the value of the product,” a man who identified himself as Abdi Salan, a member of the hijacking gang, said in a telephone interview from Harardhare. The town is in Somalia’s semi-autonomous northern Puntland region close to where the ship is anchored. He didn’t give a deadline or say what would happen if the money isn’t paid.
The Sirius Star, which belongs to Saudi Arabia’s state-owned shipping line, Vela International Marine Ltd, and its crew of 25 were seized about 420 nautical miles (833 kilometers) off Somalia on Nov. 15. It is carrying more than 2 million barrels of crude valued at about $110 million. Very Large Crude Carriers cost about $148 million new.
Hmmmh. How many of you call that change?
Bill Clinton, former U.S. president, speaks during a session of the Clinton Global Initiative in New York, Sept. 25, 2008. Photographer: Jeremy Bales/Bloomberg News
Nov. 20 (Bloomberg) — Bill Clinton has sent President- elect Barack Obama‘s transition team a list of more than 200,000 donors to his foundation, according to a Democrat familiar with the process, the latest sign both sides are trying to clear obstacles to Hillary Clinton‘s possible nomination as U.S. secretary of state.
“I’ll do whatever they want,” the former president told reporters in New York yesterday. “This is a deal between” Obama “and Hillary,” he said.
The 200,000 or so names comprise the universe of donors to Clinton’s presidential library and foundation. This is separate from the Clinton Global Initiative, which operates under the aegis of the foundation but does not directly take money from the donors.
The list of contributors ranges from those who gave a few dollars to wealthy foreign leaders and business people who donated multimillion-dollar gifts, the Democrat familiar with the matter said.
Fed sharply lowers economic forecasts for this year, 2009; signals another rate cut coming
WASHINGTON (AP) — The Federal Reserve on Wednesday sharply lowered its projections for economic activity this year and next, and signaled that additional interest rate reductions may be needed to help combat the worst financial crisis to jolt the country in more than a half-century.
With the economy forecast to lose traction, or even jolt into reverse, unemployment will move higher, the Fed predicted.
Facing the likelihood of “significant weakness” in the economy, some Fed officials suggested “additional policy easing could well be appropriate at future meetings,” according to documents from the Fed’s most recent closed-door deliberations on interest rate policy at the end of October.