...the main business headlines..........
Markets fall over earnings fears
Share prices fell in the US and Asia as investors took fright over corporate earnings. In the US the Dow Jones Average fell 73 points after KKR suspended its dividend and Starbucks reported lower than expected earnings. In Asia markets also reacted negatively, with the MSCI Asia Pacific Index falling 3.1 per cent after a series of companies missed their earnings targets. Watch-maker Citizen cut its forecast and saw its shares slide 9.5 per cent, while Hanjin Shipping fell 15 per cent after it posted a loss. In the UK the FTSE 100 opened one per cent stronger.
All bets are on with recession gambling 
Writing on the wall for GM
General Motors shares "plunged" to a 59-year low as it moved closer to bankruptcy, said Bloomberg.com. "Only federal aid" can prevents its collapse, analysts believe, as the industry awaits the decision on whether more government money will be forthcoming. State rescue is the only option for the company, with its money running out and re-financing virtually impossible in the current climate. Its shares fell $1 to $3.36, the lowest since 1949, and broker Deutsche Bank said they may be "worthless" in a year’s time.
Are GM, Ford and Chrysler too big to fail?
Prime Minister signals tax cuts
Gordon Brown yesterday gave his "firmest signal yet" that the government is planning tax cuts to relieve economic pressures, reported the Financial Times. In a speech to the City, the Prime Minister talked about increases in borrowing, seemingly a sign that the upcoming pre-Budget report would contain details of imminent tax cuts. Higher public spending could also form part of the stimulus package, with chancellor Alistair Darling having already suggested that he wants to bring forward projects to "pump-prime" the economy.
The banking collapse is all your fault
Mortgage market to shrink 80 per cent
The UK mortgage market will shrink by 80 per cent this year, according to Nationwide, with house prices falling for another year and no stabilisation in the market until 2010. The lender said that it now forecast the total mortgage market to be £18bn this year, versus £90bn last year. It also suggested that monthly house price falls of between one and 1.5 per cent per month were likely into 2009, with the total decline in value in the recession likely to top 25 per cent before any improvement is seen in 2010.
The Bank of England's desperate bid for relevance
RBS: a failure made in Scotland
Mandelson backs Post Office
Lord Mandelson, is "urging" the prime minister to save the Post Office network, by allowing it to provide a range of financial products, said the Guardian. In a leaked letter he says that the current downturn and problems in the banking sector "present an opportunity" for the organisation to take on a new role, as a trusted UK institution. The move is "likely to surprise" Labour and opposition politicians alike, who were under the impression that the network was being reduced as a drain on national resources.
Time to send the Post Office to market
Retail sales drop in October
Retail sales in the UK dropped for the first time in three years in October, reported the Times. Figures from the British Sales Consortium showed that like-for-like sales in the month were down 2.2 per cent, and total sales dropped 0.1 per cent, the first time there had been an annual decline since April 2005. The organisation said that the numbers were "further evidence" of the tough trading environment. The only bright spot was online and mail order non-food sales, which rose 16.6 per cent, however this makes up only four per cent of the total.
A trillion reasons to be gloomy about the economy
...in brief..................
HBOS investors rubbish bid and Standard Chartered rights issue talk
Some of the biggest shareholders in HBOS have "poured cold water" on the plans by Sir Peter Burt and Sir George Matheson to keep the bank independent, said the Financial Times. One called the idea "ludicrous" and others dismissed the suggestion out of hand…………
Lloyds rescue would not have been allowed in normal times
Santander, the Spanish owner of Abbey National, Alliance & Leicester and Bradford & Bingley bit the bullet and announced a €7.2bn rights issue. After the statement shares in the bank fell five per cent. Two weeks ago it had denied the need to raise capital…………
American Express has converted to a bank holding group in a surprise move to allow it access to Federal Reserve funds. The credit card company's application was approved speedily after it recently announced cuts in jobs and a steep rise in bad debt provisions…………
Welcome to Wall Street's cash machine
Dairy Crest, the cheese and milk producer, has axed 100 staff and warned that pre-tax profits will fall 10 per cent, said the Daily Telegraph. After the announcement its shares slumped by a quarter, as investors digested the impact of higher costs and slowing demand…………
John Dunsmore, the former boss of brewer Scottish & Newcastle, has joined struggling cider-maker Magners as chief executive, said the Guardian. Magners shares have collapsed 90 per cent in the last two years as its expansion in the UK proved too rapid…………
Standard Chartered is the latest bank to face the spectre of a rights issue. The earlier move by Santander has put pressure on the emerging markets lender to follow it with an issue of its own. Its capital levels are thought to be similar to Santander's before it announced its move…………
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