Business Headlines
Markets fall for a second day
Markets fell around the world for the second day in a row as investors became concerned that the global economy is deteriorating more quickly than expected. The Standard & Poor's 500 Index dropped five per cent in New York yesterday after an increase in unemployment was reported, and markets in Asia fell again, with the MSCI Asia Pacific Index down 1.8 per cent on the day. The fall erased most of the week's gains as the International Monetary Fund forecast the first global recession since World War II. In the UK the FTSE opened up over one per cent.
After the credit crunch, what next for the world? 
More to come after UK rates fall to 53-year low
After the Bank of England cut rates to a 53-year low of three per cent yesterday, there were "clear indications of more cuts to come", said the Financial Times. The cut was three times as big as any since the monetary policy committee was founded in 1997, but with the International Monetary Fund, among others, forecasting deep recession in the UK, the potential for more cuts was revealed in comments by the BoE. It is now expected that "at least another percentage point" will be cut from the base rate by April next year.
The Bank of England's desperate bid for relevance
New car sales plummet
New car registrations in the UK plunged by 23 per cent in October, it was revealed yesterday by the Society of Motor Manufacturers and Traders. Total sales for the first 10 months of the year dropped 8.8 per cent to 1.92m, leading the organisation to downgrade its forecast for the full year to 2.15m vehicles, from 2.4m in 2007. The dramatic decline in sales brought calls from industry figures for interest rate cuts to be passed onto consumers by banks, as brands like Bentley and Jaguar saw sales halve in October.
Are GM, Ford and Chrysler too big to fail?
Banks that fail to pass on rate cuts to face government action
Government figures, including Prime Minister Gordon Brown, urged banks to pass on yesterday's one and a half point reduction in interest rates to consumers, reported the Independent. A number of Labour MPs called for legislation to force banks to lower mortgage rates to fall in step with the drop in the base rate, and ensure that "people who need it most get help". While there was no mention of legislation on the issue, ministers "hinted at other action" to force banks the banking industry into line, particularly those with public money.
The M ole: City gasps as Bank throws caution to the wind
IMF agrees Hungary bail-out
The International Monetary Fund has approved a $15.7bn loan for Hungary, said the Daily Telegraph. $6.3bn will be handed over straight away, with the remainder to be distributed in five instalments. In total $25.1bn has been earmarked for the country, which has suffered more than many as a result of the financial crisis. In return for the fund, the government has agreed to "significant" spending cuts and wage freezes in the public sector and the provision of capital to the banking industry to ease the credit crunch.
Hungary is counting the cost of capitalism
What happens when a Western economy dies
Icesave rescue to cost £800m
Chancellor Alistair Darling announced that the Treasury will be spending £800m to fund the compensation for UK depositors with Icesave, said the Times. 240,000 savers have money in the failed Icelandic bank. The size of the bail-out caused concern, as did the way in which the compensation is being organised. The Financial Services Compensation Scheme which is responsible for re-funding customers, has come under fire after many savers said they have not been contacted with details. A government spokesman said it "hoped to recover" the money from Iceland.
...in brief..................
House prices plummet and Royal Worcester goes into adminstration
House prices fell 15 per cent in the year to October, a record drop, and were down 2.2 per cent on the month before, according to Halifax. The numbers emerged shortly before the historic drop in interest rates and wiped £30,000 off the value of an average home in the UK…………
Private equity company Blackstone saw its shares plummet yesterday on concerns that it will fail to collect funds from investors. The company, which floated in the US last year, announced a quarterly loss and issued a warning that the weakness in the economy was affecting it adversely…………
New President-elect Barack Obama has assembled a team of advisors, named the Transition Economic Advisory Board, to address the country's economic woes. It includes legendary investor Warren Buffet, Google chief executive Eric Schmidt and former Fed chief Paul Volcker…………
US transition: pundits line up to offer advice
Shares in Man Group, one of the world's biggest hedge fund groups, slumped 31 per cent yesterday, after it reported a worse-than-expected drop in half-year profits. Analysts labelled the results "shocking" as Man said that six-month pre-tax profits fell by 24 per cent…………
How Porsche took the hedge funds to the cleaners
Lenovo Group, maker of Thinkpad laptops and China's largest computer-maker, saw profits fall by two thirds in the second quarter. Customers reduced their spending as a result of the slowing economy and moved to cheaper competitors like Hewlett-Packard, Dell and Acer…………
Royal Worcester, one of the oldest makers of porcelain and bone china, went into administration yesterday. The 250 year old company was forced to call in its bankers after attempts to effect a rescue failed, leaving 388 jobs at risk at its factories in Stoke and Worcester
Posts
