business headlines
After an earnings warning by Sony pushed its shares down over 12 per cent, Japan’s Nikkei 225 index hit a five and a half year low, closing down nearly 10 per cent. The fall helped the rest of Asia slump, as evidence emerged that the world was moving towards a co-ordinated recession. Korean stocks declined nearly nine per cent, and other markets in the region also suffered declines. The problems in Asia reversed previous gains in US futures, with December Dow down around 300 points, and the FTSE 100 responded by opening down four per cent.
Japan's return from financial oblivion 
Russia at risk of debt default
Russia's financial crisis is deteriorating rapidly as foreigners pull out of the country and sovereign default becomes a serious possibility, said the Daily Telegraph. The cost of insuring Russian bonds against bankruptcy "rocketed" yesterday, reaching levels higher than Iceland's before it went to the IMF for emergency funding. Ratings agency Standard & Poor's warned that a series of state rescue packages could "erode the credit-worthiness" of the country, although analysts pointed out that it has $500bn of foreign reserves, the world's third biggest.
What happens when a Western economy dies
Money market rates on rise again
Money market rates rose in Asia as recession worries increased in countries as diverse as South Korea and Argentina and Standard & Poor's considered cutting Russia's debt rating, said Bloomberg.com. The interbank lending rate in Hong Kong rose for the second day, as did rates in Australia, as the recent unfreezing appeared to be coming to an end. Requests by Belarus, Iceland, Pakistan, Hungary and Ukraine for emergency funds also worried the markets, as Libor fell yesterday in London by the smallest amount in nine days.
The banking collapse is all your fault
Pounds falls below $1.60 as recession fears take hold
The pound "tumbled below $1.60" for the first time in five years as Britain moved towards the jaws of recession, reported the Times. Sterling slumped to $1.5946 against the dollar this morning as new figures were awaited, showing that the UK economy contracted in a quarter for the first time in over sixteen years. Sterling has been "under pressure" since Bank of England Governor Mervyn King and Prime Minister Gordon Brown both mentioned recession for the first time, this week.
Democracy has led us to the brink of collapse
Traders bet against Opec oil cuts
Investors are doubtful that Opec will come up with meaningful cuts in oil production and as a result are betting against the oil price, said the Financial Times. Opec members seem united on the need for a cut but have "widely divergent views" on the size needed. Ahead of today's Emergency meeting in Vienna traders said that put options have built up, indicating investors believe that the price of oil could fall as low as $50 by December. The oil price did recover on Thursday, but number of 'put' options has risen by 30 per cent in the last month.
Oilopoly: a delicate dance with the Russian bear
Greenspan owns up to mistakes
Alan Greenspan, the former Federal Reserve Chairman, said he made mistakes in his treatment of the financial industry, reported the Financial Times. In a hearing on Capitol Hill he said he had “found a flaw” in his methods but also felt that the sort of heavy regulation that would have prevented the crisis would have “damaged” US growth. He said he had assumed that financial institutions would carry out proper checks on their counterparties, given that the system seemed to have worked for the past 40 years.
Newsdesk: Greenspan takes the blame
America enters a new Depression
...in brief..................
More EU rate cuts likely and JP Morgan ceo gets death threats
Signs are emerging that there will be more cuts in European interest rates, reported the Financial Times. Two weeks after the Central Bank cut rates to 3.75 per cent, an ECB board member told a newspaper that it could cut rates "without adding to inflationary risks"…………
Goldman Sachs is planning to cut 10 per cent of its workers in fixed income and investment banking, the areas hardest hit by this year's financial crisis. With 6,000 employees in London, that will mean 600 jobs are set to be lost in the capital. The company had previously been adding staff…………
AIG rescue and the Goldman connection
Samsung Electronics, Asia's biggest maker of silicon chips, LCD flat screens and mobile phones, announced its biggest drop in profits for more than three years on falling prices. Samsung shares fell eight per cent after it said third quarter net profit fell 44 per cent…………
Shares in leading European media group Mecom fell more than 24 per cent to 3.7p yesterday, as fears grew for its future. Media stocks have been targeted for selling recently but Mecom has bigger problems than most, as a result of its heavy debt burden…………
Royal Mail's half-year operating profits more than doubled in the six months to the end of September on a postal volume decline of four per cent. However its pension fund deficit jumped 25 per cent to £4bn, which it is likely to approach the government to help plug…………
Jamie Dimon, chief executive of JP Morgan Chase Bank, has been targeted with death threats in 45 anonymous letters, thought to be from the same source, said the Daily Telegraph. They accuse Dimon of "stealing" Washington Mutual, bought by the bank last month…………
People: RBS's Fred gets shredded
Posts
