Davos 2009: U.S. Stimulus reaction (Video)

Davos 2009: U.S. Stimulus reaction

Wall Street bonuses under scrutiny

Wall Street bonuses under scrutiny
(02:02) Reuters Video Report

Jan 30. - As Obama attacks Wall Street bonuses, officials investigate executive pay and consider regulating compensation.
$18.4 billion in Wall Street bonuses were paid in 2008 despite mounting losses and government bailouts. Manoush Zomorodi reports from New York.

Obama's Condemnation of Wallstreet's big bonuses

Obama Is Right: Wall Street's Big Bonus Pool Is "Shameful"

Without mincing words, President Obama strongly condemned Wall Street's $18.4 billion bonus pool for 2008, calling it "the height of irresponsibility" and "shameful."
The issue is not that Obama is trying to dictate how financial services companies run their business, or what level of compensation executives make, as his critics claim.
The issue is that Wall Street firms ran themselves into the ground and came to the government hat in hand. Once your firm is on the government dole, it's outrageous for taxpayer money to be used to pay bonuses, which aren't guaranteed annually, contrary to the popular view on Wall Street.

U.S. GDP decreased at an annual rate of 3.8 percent in the fourth quarter of 2008

Latest Measure of the Nation's Economy, Q4 GDP down 3.8 percent, biggest drop since 1982

Gross Domestic Product (GDP) measures the market value of the entire nation’s goods and services produced by labor and property in the United States. (Gross Domestic Product News Release)
GROSS DOMESTIC PRODUCT: FOURTH QUARTER 2008 (ADVANCE)

Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- decreased at an annual rate of 3.8 percent in the fourth quarter of 2008, (that is, from the third quarter to the fourth quarter), according to advance estimates released by the Bureau of Economic Analysis. In the third quarter, real GDP decreased 0.5 percent.

Exxon Mobil breaks its own mark for full-year profit

Exxon Mobil shatters US record for annual profit
Exxon Mobil breaks its own mark for full-year profit, but fourth-quarter results tumble

HOUSTON (AP) -- Exxon Mobil Corp. on Friday reported a profit of $45.2 billion for 2008, breaking its own record for a U.S. company, even as its fourth-quarter earnings fell 33 percent from a year ago.
The previous record for annual profit was $40.6 billion, which the world's largest publicly traded oil company set in 2007.
The extraordinary full-year profit wasn't a surprise given crude's triple-digit price for much of 2008, peaking near an unheard of $150 a barrel in July. Since then, however, prices have fallen roughly 70 percent amid a deepening global economic crisis.
In the fourth quarter alone crude tumbled 60 percent, prompting spending and job cuts in an industry that was reporting robust, often record, profits as recently as last summer.

Zakt de AEX door de 218 punten?

FOCUS: AEX gaat vermoedelijk door 218 punten

(Volgens een bericht op de De Telegraaf -DFT site zakt de AEX door de 218 punten, zie bericht:)

Voor technisch analist Roelof-Jan van den Akker van ING Wholesale Banking is er geen twijfel mogelijk: "Die 218 punten gaat eraan. In november 2008 waren we er erg dichtbij, maar toen bleek de test succesvol. Daar ben ik nu minder zeker van. We zaten, zitten en blijven in een bear market en er is geen enkel opwaarts potentieel, zolang de toppen van 272 en 291 punten niet worden doorbroken.
AMSTERDAM (Dow Jones) - De AEX is gevangen in een trading range. De pogingen om daar aan de bovenkant uit te breken hadden weinig overtuiging. Naarmate de tijd vordert groeit de indruk dat de AEX niet zozeer bezig is met bodemvorming, maar met een proces van lagere toppen. Bij handelaren en marktvorsers groeit het ’vermoeden’ dat de AEX nog een keer een klap omlaag maakt en door het dieptepunt van 12 maart 2003 zal zakken van 218 punten.

(Commentaar Trendsbridge: Wij verwachten al sinds september 2008 dat de bodem in de markt ligt rond de 180 punten voor de AEX en rond de 5000 voor de DJIA. Volgens onze analyse wordt dat in de komende 3 of 4 maanden bereikt. De banken zijn nog verre van gezond en er komt steeds meer verborgen en onderliggende rotzooi over de economie en de financiële sector naar boven.
In feite geldt; hoe eerder de bodem bereikt is hoe beter, zodat er een nieuwe start gemaakt kan worden. Bovendien begint dat gelazer van steeds zakkende koersen en voortdurend slechte economische berichten ons ook behoorlijk de strot uit hangen. Het bloggen was spannend maar begint nu (na 3 maanden) ook alweer aardig te vervelen.)

Japan factory output plunges, jobless rate jumps

Japan factory output plunges, jobless rate jumps

Recession spreads in Japan as factory output plunges, joblessness jumps, family spending falls

TOKYO (AP) -- The pain of Japan's recession is spreading from the factory floor to the living room, as December figures showed companies slashed output at a record pace, the jobless rate surged and household spending fell sharply.
Industrial production at the nation's manufacturers plunged 9.6 percent in November, the largest drop since Tokyo began measuring such data in 1953, the government said Friday. A survey predicted further declines of 9.1 percent in January and 4.7 percent in February.
Meanwhile, Japan's unemployment rate jumped to 4.4 percent from 3.9 percent in November -- the biggest increase in almost 42 years, according to the Ministry of Internal Affairs. Household spending dropped a worse-than-expected 4.6 percent in December, falling for the 10th straight month.
The global slowdown has crippled big-name manufacturers like Sony Corp. and Toyota Motor Corp., who rely heavily on overseas sales to drive growth. The yen's surge over the past few months has dealt a further blow to the world's second-largest economy by eroding exporters' overseas earnings.

Japanese electronics giant NEC Corp. says it plans to slash at least 20,000 jobs worldwide in an effort to cut 80 billion yen in costs over the next two years.

The Nikkei dropped 3.12 percent today, below 8000. Honda cuts annual profit forecast.

Sony's profits tumbling

Sony's quarterly net profit plunges 95 percent as electronics division slides into red
TOKYO (AP) -- Sony said Thursday its net profit plunged 95 percent in the October-December quarter, as the holiday shopping season provided no respite for the struggling electronics giant and tepid sales of TVs, digital cameras and mobile phones hit its bottom line.
The Japanese manufacturing icon said its usually dependable electronics division posted its first-ever operating loss for the fiscal third quarter. It also reiterated its forecast for a net loss of 150 billion yen ($1.67 billion) for the full fiscal year through March -- its first loss in 14 years.
Sony Corp. said net profit shriveled to 10.4 billion yen ($115.6 million) in the third quarter from 200.2 billion yen a year earlier. Revenue fell 25 percent to 2.15 trillion yen from 2.86 trillion yen.

Sony Global - Press Release

(January 29, 2009). Consolidated Financial Results for the Third Quarter ... Statement Regarding Media Story on Sony's Financial Results ...


Earnings Release Download PDF

Madoff results were impossible to replicate

Madoff results were impossible to replicate

Michael Markov, chief executive of Markov Processes International, said his company analyzed one of Fairfield Greenwich's funds that invested with Madoff in 2006 and concluded the returns were most likely not real. Such returns would have required perfect foresight and more option contracts than existed in the market, he said.
"It was impossible to replicate," Markov said.
Click on the link to visit the Markov Processes International website

(Since 1992, Markov Processes International has been a preeminent provider of customized solutions to the financial services industry. By harnessing our great expertise in advanced mathematics, financial analysis and software development, we have developed software applications and consulting services that reflect the creative spirit and advanced thinking that define our organization. It is the unique appreciation and understanding of our clients' needs, however, that is most responsible for the flexible and efficient nature our products. We strive to continually provide the most advanced solutions to our clients, regardless of their size or specific needs. As a result, we provide everything from enterprise platforms that serve global financial services organizations to software applications that serve individual investment advisors.)

12.22.2008 | MPI Announces Release of New Research Paper
- PRESS RELEASE - MPI's paper entitled Madoff: A Tale of Two Funds demonstrates how advanced returns-based analysis techniques could have alerted investors to potential inconsistencies. Download PDF

Global crisis politics - A Davos debate with Nouriel Roubini and Ian Bremmer on Reuters

Global crisis politics - A Davos debate with Nouriel Roubini and Ian Bremmer

As governments grapple with the global crisis, politics has taken on central importance in determining the course of the world economy — and political risk is more significant than ever.
Two leading experts on the financial crisis and its political dimensions — Nouriel Roubini and Ian Bremmer — gave exclusive answers this week to Reuters questions on the key risks for 2009 and beyond, and the countries to watch.

Read all of it on Reuters

Davos 2009: Justifying the trip
(02:01) Video Report Reuters

Jan 28 - Despite organisations cutting travel budgets and reigning in spending, it seems the World Economic Forum is still drawing large numbers.
In fact, with two-and-a-half-thousand participants, this year's event in the Swiss resort is shaping up to be one of the largest forums on record.
With delegates travelling to Davos from as far away as Australia and Mongolia,




NYU's Roubini: "Nowhere to Hide" from Global Slowdown

Nouriel Roubini of NYU’s Stern School of Business is making fresh headlines, as he's forecasting an even more dire outlook for the global economy. In an interview yesterday with Bloomberg News in Zurich, Roubini said:

The U.S. will lose 6 million jobs with unemployment reaching at least 9 percent.
* The U.S. economy will expand 1 percent at most in 2010.
* Economic growth in China will slow to less than 5 percent.
* He reiterated his statements that the biggest U.S. banks are insolvent, and that losses could reach $3.6 trillion, far exceeding his original estimates.

Yahoo Earnings Preview

Carol Bartz, Yahoo CEO

Yahoo Earnings Preview

Darren Chervitz, co-manager of the Jacob Internet Fund, which counts Yahoo among its top 10 holdings. "She seems [like a] forthright, determined executive who doesn't pull punches."

S&P: Home values post 18.2 pct annual drop in November

S&P: Home values post 18.2 pct annual drop in November.
The Standard & Poor's/Case-Shiller 20-city housing index released Tuesday tumbled by a record 18.2 percent from November 2007, the largest decline since its inception in 2000. The 10-city index dropped 19.1 percent, tied with October for the biggest drop in its 21-year history.
The sharpest drop on record.

Download the PDF

http://www2.standardandpoors.com/spf/pdf/index/CSHomePrice_Release_012724.pdf

The Markets today (27 January)

The Markets today (27 January)
Yesterday (26th) was a good day for the markets although Wallstreet disappointed a bit.
European Markets performed well, especially the Dutch Market (Amsterdam AEX), on results from ING and Philips. The AEX closed higher with a gain of almost 6%, despite ING is asking again the Dutch government for a 25 billion Euro emergency loan.
The financial sector has been heavy battered last year and investors grab any bit of relatively 'good' news about the sector to start buying.

The Dutch Finance Minister Wouter Bos is going to face tough questions from the opposition in Parliament about his generous helping hand for the ING bank.
News from the U.S. suggests that of 9 out of 10 bailed out banks the CEO's are still in place, although more than 100.000 employees are laid off. (The trouble with the bailout is that nobody in government ever stopped to figure out who caused the avalanche and who simply got buried, said University of Maryland business professor Peter Morici, http://angrybear.blogspot.com/ )

In general the Dutch Government is not yet coming up with an intelligent stimulus plan, a state of 'collective denial' seems to exist.
Some people are waiting for the first Postbus 51 (government propaganda) TV spots, with texts like "Recession? don't worry, there are plenty of jobs in health care!" or "Don't use the word recession, it's a negative." or "Be a good patriot, never use the word recession, it does not happen in Holland!"
The massive layoffs planned by ING, Philips and Corus did not impress the market.
This morning the newspaper 'De Telegraaf' opened with news about the layoffs, the rising unemployment and the deteriorating real estate market.

This morning rises in European markets are very modest and it looks like the bear market rally cannot gain momentum. De German Ifo was up but not enough to indicate a turnaround in the economy.
The Far East markets were a bit subdued with the exception of Tokyo with a healthy gain of almost 5 percent. Australia and India (Sensex) closed up as well. According to the news Tokyo rose on optimistic news from Barclays.
The outlook for U.S. markets is undecided, futures point to a higher opening.

News from Yahoo Finance about lower dividend forecasts across the board.

Dividends being cut at fastest pace in 50 years


Dividends being cut at fastest pace in 50 years; Pfizer slashes its dividend in half
NEW YORK (AP) -- Dividends are being cut at the fastest pace in at least 50 years, and many of the reductions are coming from U.S. companies investors have been relying on to provide income during the recession.
Already this year, seven companies in the Standard & Poor's 500 index have decreased their dividends, removing some $12 billion from shareholders' pockets in the coming months. On Monday, Pfizer became the latest blue-chip company to do so.
These cuts serve up another hit to shareholders who have already been battered by the steep declines in the stock market. That is especially true of retirees, who tend to be attracted to so-called "widows and orphans" stocks that provide them with a steady cash flow.
If the trend continues, this will be the worst year for dividend cuts since 1958, when annual payments fell by 8.4 percent, according to new research from S&P.

ING opnieuw aan het Bos Infuus

ING Bank doet opnieuw een beroep op het Bos Infuus

ING krijgt opnieuw 25 miljard Euro hulp van de Nederlandse overheid.
De afschrijvingen op de hypotheken, met name de slechte onroerend goed portefeuille in de V.S. (ALT A), en de verslechterde marktomstandigheden brengen de positie van de ING in gevaar. ING schrijft 3.9 miljard dollar af op de ALT A -portefeuille met Amerikaanse hypotheken, die daardoor nog een restwaarde heeft van 35,1 miljard dollar maar voorlopig nog nauwelijks verhandelbaar is.
Het ziet er naar uit dat de ING in navolging van een aantal banken in de V.S en in het Verenigd Koninkrijk in de tweede fase van de bailout terecht komt. Een niet onverwacht scenario.
Voor de overheidssteun van 25 miljard van de Overheid moet ING beloven de kredietverstrekking aan bedrijven en particulieren te vergemakkelijken.
ING gaat wereldwijd 7000 banen schrappen, hoeveel banen in Nederland is nog onduidelijk maar wordt op 18 februari a.s. bekend gemaakt.
Wel heeft de bank nu al bekend gemaakt dat bestuurders van hun bonus af te zullen zien, dat wordt afzien voor de top dus.
ING meldde verder dat topman Tilmant verdwijnt. Hij wordt opgevolgd door ex-Philips topman Hommen.

Amsterdam 11.30 (CET), de AEX stond op 2.30% winst met zowel ING en Philips als stijgers. In navolging van ING trokken ook de andere financiële waarden aan.

Klopt het wat weekblad Privé heeft gemeld over beleggingen van de Koninklijke familie bij Madoff?

Klopt het wat weekblad Privé heeft gemeld over beleggingen van de Koninklijke familie bij Madoff?

Normaal reageert de RVD niet op vragen over het privé-vermogen van leden van de Koninklijke familie. Maar nu ook in de serieuze media als in eerste instantie het Algemeen Dagblad de verzinsels uit Privé worden gemeld, inclusief insinuaties met betrekking tot personen, rest de RVD niets anders dan te zeggen dat het artikel in Privé van a tot z uit de duim gezogen is.

=====================================================================
(26 JANUARI 2009)
"Het weekblad Privé heeft gemeld dat Het Koninklijk Huis tot de slachtoffers van Bernie Madoff behoort en voor een bedrag van 20 tot 100 miljoen Euro het schip in is gegaan. Tot nu toe is dat onbewezen, maar het is ook onwaarschijnlijk dat dit door Privé volledig uit de lucht gegrepen is.
Madoff was een VTP (Very Trusted Person) en ex-voorzitter van de NASDAQ, en heeft in de afgelopen 20 jaar veel rijke en invloedrijke personen tot klant gehad.
Het was een eer om bij Madoff te mogen investeren. Of dat nu nadat er een slordige 50 miljard dollar is verdwenen en een spoor van ellende met verschillende '1929 stijl zefmoorden', nog zo gezien wordt is twijfelachtig.
(Claims on Madoff, Source Bloomberg
The clients included banks, hedge funds, charities, universities and wealthy individuals who have disclosed about $41 billion invested with Bernard L. Madoff Investment Securities LLC, according to a Bloomberg News tally of disclosures and press reports.)

Het Koninklijk Huis heeft dergelijke verhalen echter volledig aan zichzelf te wijten zolang de geheimzinnigheid over de financiële status blijft bestaan, en er geen openheid gegeven wordt.

In de thriller dimensie die de 'Madoff Mess' begint te krijgen zou het echter perfect passen.
De getergde reactie van de RVD is in dit opzicht veelzeggend. Evenals de 'lauwe kerstrede' van de Koningin, en de paniekerige gezichtsuitdrukking van Premier Balkenende ruim 6 weken geleden.

'Restoring Confidence and Transparency', hoor ik net op CNBC in relatie tot de Madoff Crisis. Dat geldt zeker ook voor Den Haag!"

N.B. Verder is in de RVD reactie (op de site van Het Koninklijk Huis) het elitaire omderscheid tussen 'serieuze en niet serieuze media' opvallend. Niet echt de Koninklijke weg.
Of zou het de voorbode zijn van een wat meer geraffineerde beperking van de Vrijheid van Meningsuiting?
Het is tenslotte een economische crisis op wereldschaal, en inhalig graaigedrag in combinatie met een diepgewortelde angst is alomtegenwoordig.
Elsevier publiceerde op vrijdag 23 januari ook al een reactie op het bericht in Privé.

Royal Philips Electronics, 4th Quarter Results 2008, Disappointing

Royal Philips Electronics, 4th Quarter Results 2008.

The 4th Quarter 2008 for Philips has been disappointing, first quarter loss since 2003.

Today at 7:00AM CET (Dutch time), Royal Philips Electronics announced its financial results for the fourth quarter of 2008. Please find below full details. (Check out the website)
A conference call with Gerard Kleisterlee, President & CEO, and Pierre-Jean Sivignon, Chief Financial Officer, to discuss the results starts at 9:15AM CET today. A live audio webcast of the conference call will be available through the link below. This audio webcast will remain available for replay for 1 year (accessible today at approximately 12:00PM CET). Furthermore a transcript of this call will be published here soon.


Financial report (Downloadable PDF)

* 2008 - Fourth Quarterly Report

Presentation (Downloadable PDF)

* 2008 - Fourth Quarter Results Presentation

Is the modern (21st Century) Economy 'dysfunctional'?

Still rather unexpected, but obviously hoovering around in our minds the question popped up: 'Is the Economy dysfunctional'?
The debate; 'Inflation or Deflation' is not even finished, although there is enough opinion and evidence - 1929 Crisis and Japan in the nineties- to keep the dicussion going.
In the last one and a half years we have seen something which is unprecedented in modern history, something which at first looked like a minor spot or unregularity in the financial markets, developing into a Global Economic Crisis. It looks like it suddenly happened, and every day more evidence is shown it is for real, many people still cannot comprehend it. How could this happen and so fast?

In the past week we did not hear very much from the World Economic Forum in Davos about the dysfunctionaly of the Modern Economy. In general the mood was not so great between the mountains there. There was a lot talking about what everybody already knows, e.g. the need for green and sustainable energy systems, but no great new creative breakthrougs.
Voices (from everywhere) are beginning to be heard about de-globalisation.

In fact our economic and monetary fundamentals are still based on Bretton Woods from just after the Second World War. Our primary Economic system is still based on Adam Smith's idea and philosophy. Nothing wrong with his systen, we think.
But one of the troubles right now and from the last 20 years is a matter of supply and demand, plenty of supply for the better paid consumers, but the less earning consumers simply do not have the money to buy these goods. The divide between rich and poor is getting sharper. Governments have not shown much restraint in taxation and waisted enormous amounts of money in useless project and bureaucracy.
At the same time they did not do what they should have done, regulate markets if necessary, provide infrastructure and education, and stimulate new ideas.
Money was abundant, but taxing everything takes money out of the smaller pockets first.
The poor are more and more subsidizing the rich.

The increasing amount of cheaper producing nations, together with the expanding consumer base is having its impact on the Global changing environment. Western Nations have become fat and lazy, but they have to offer a better outlook for (at least) this century to the rest of the world. It's not only Politicians or Economists which to come up better ideas.
(More to follow...)

The Markets Friday January 23

The Markets Friday January 23
The Far East Markets were weak, Tokyo (Nikkei) drops 3.81 percent.
European Markets were all down (Amsterdam 14,30 GMT, on the AEX only KPN was up 1.44 percent, the index was down 2.7 percent), FTSE 100, DAX, CAC 40 off between 2 and 3.10 percent.
The futures outlook for Wallstreet indicates an opening with heavy losses.

Google's Fourth-Quarter Earnings Beat Expectations

Xerox 4Q profit plunges, misses Wall Street view
GE 4Q profit falls 46 pct, adjusted net meets view
Harley to cut 1,100 jobs as 4Q profit falls
Samsung Electronics reports first quarterly loss

EU economy hit hard by global downturn, gloomy outlook

EU economy hit hard by global downturn

The Commission expects EU and eurozone economies to shrink almost 2% in 2009 before recovering moderately in 2010. (January 19)

Commission cuts economic growth forecast as scale of financial crisis and ensuing global downturn become apparent.
The Commission estimates that economic growth fell to about 1% in 2008 in both the EU and the eurozone (down from just below 3% in 2007). The latest forecast projects that real GDP will contract by almost 2% in both regions in 2009, before growing again by about 0.5% in 2010. These figures are lower than the autumn forecast.
With the EU economy expected to shed some 3.5m jobs this year, unemployment is set to rise. The rate is forecast to reach 8¾% in the EU in 2009 (9¼% in the eurozone), with a further increase in 2010.
Public finances will be hit, too. The headline deficit for EU countries – a raw measure of budget shortfalls – is expected to more than double this year, from 2% of GDP in 2008 to 4½ % in 2009 (from 1¾ % to 4% in the eurozone). As a result, several EU countries are projected to breach or stay over the EU deficit cap of 3% of GDP. A further worsening of the budgetary outlook is expected for 2010.

Actuele Dekkingsgraad Pensioenfondsen

Actuele Dekkingsgraad Pensioenfondsen

22-1-2009
Toelichting DNB op het maken van herstelplannen
Op 19 januari jl. heeft De Nederlandsche Bank (DNB) een toelichting gegeven op het te maken herstelplan. Hieruit blijkt dat DNB een gestaag herstel belangrijk vindt en niet zonder meer een korting van aanspraken zal toestaan aan fondsen die in onderdekking zitten (dekkingstekort). Indien korting van opgebouwde pensioenen wel deel uitmaakt van het herstel, moet ook een ‘dekkingsgraadsjabloon’ worden ingediend waarin geen rekening wordt gehouden met deze korting. Dit laatste zou DNB voor maatwerk kunnen gebruiken (bijvoorbeeld een extra jaar herstel).
Voor het kortetermijn herstelplan geldt overigens niet de wettelijke eis van gestaag herstel. DNB vindt gestaag herstel echter wel voor de hand liggen, ook omdat het kortetermijn plan onderdeel is van het langetermijn plan. Fondsen die aan het eind van de drie jaar blijven zitten met een hoge mate van dekkingstekort moeten in de besluitvorming over het tempo waarmee gekort wordt een evenwichtige belangenbehartiging toepassen. Bij fondsen met een zeer kleine kans op herstel zouden actieven benadeeld worden door pas na 3 jaar te gaan korten. Hier ligt eerdere korting dus wel voor de hand.

Russian Billionaires cash in their toys as slump grips Russia

Russian Billionaires cash in their toys as slump grips Russia

(Source Independent.ie)
Russian oligarchs are having to sell off yachts, private jets and holiday homes to raise cash as they finally feel the squeeze from the worldwide recession.
The country's billionaires have lost more than €176bn between them since Russia's stock markets began to nosedive last summer, with Oleg Deripaska and Roman Abramovich among the worst hit.
Mr Abramovich, owner of Chelsea FC, has had a reported €15bn wiped off the value of his shareholdings, while Mr Deripaska, Russia's richest man, has lost €11.7bn, according to the financial news service Bloomberg.
Despite many oligarchs claiming they have only suffered "paper losses" there are growing signs that the credit crunch is hitting their personal wealth.
Sergei Polonsky, the head of Russian real estate giant Mirax Group, has announced he is selling his yacht, a grand home on the Cote d'Azur and a hotel in Turkey.
Mr Polonsky, who had a fortune of €768m before the collapse in Russian stocks, said he made the decision after "having realised how important it is for business to be responsible and understanding that it is necessary to transfer foreign funds to Russia".

Google delivers good-looking 4Q in ugly recession

Google delivers good-looking 4Q in ugly recession

Google 4Q results emerge as bright spot amid gloom, but investors still worried

SAN FRANCISCO (AP) -- Google Inc.'s fourth quarter wasn't picture perfect, but the results looked good in an ugly recession.
Although Google suffered its first-ever decline in quarterly profit because of a $1.1 billion accounting charge, the Internet search leader fared far better than its peers and proved it has the discipline to curb its free-spending ways in tough times.
Even as the Google tightened its belt, its fourth-quarter revenue climbed 18 percent to $5.7 billion. It's the first time since Google went public in 2004 that its quarterly revenue growth has been less than 30 percent, but it was still a double-digit increase in a backpedaling economy.
"It was a pretty impressive performance in this kind of downturn," said Stanford Group analyst Clayton Moran.
Google's showing contrasted sharply against the performance of its biggest rival, Microsoft Corp., during the same period. Microsoft not only missed analyst forecasts, but telegraphed its diminishing expectations by disclosing plans to lay off about 5,000 workers during the next 18 months.

The Markets today (Jan 22nd)

The Markets today (Jan 22nd)

Asian markets were up but did not follow yesterday's Wallstreet strong performance (3 to 4 percent up).
European markets were slightly up between 1 and 1,5 percent.
At this moment, 14.00 GMT, Amsterdam, the futures for Wallstreet point to a loss for the S&P and the Dow Jones.
Housing Starts, Jobless Claims, Money Supply and some other Key Economic Data are due out today.
Update 18.39 GMT. Wallstreet opened with heavy losses, at this hour markets are down between 3 and 4 percent. Microsoft sank on news about cutting the workforce, and worser than expected figures, e.g. profit losses. Housing starts tumbled again and jobless claims increased.
The market is uneasy and slightly nervous not knowing what's ahead and which direction stocks will go. The November/December rally turned out to be no more than a 'bear market rally' as expected.

"Note: On this blog and on our websites we noticed people searching for a clear date, like January 23rd for instance, for a market crash.
We are not into Astrology, Bible reading, Nostradamus style predictions, Rabbit Droppings reading or other Superstitious or Paranormal things, but simply use the normal reasoning, ubiquitous information, expert opinions, and some experience combined with a gut feeling.
Thus we are very happy we cannot give an exact date for a market crash. Besides the market has already crashed in 2008, how else would you call a 40% to 50% drop?.
But we are prepared for another stockmarket crash or market free fall situation within the next 3 or 4 months. It could also be a slow crash or a slow fall testing new lows every couple of weeks, but there is a bottom in the market.
This is a very grave recession and economic downturn anyway, the whole world is slowly entering a transition mood. Confidence in politicians and authorities outside the U.S. is decreasing. Many people simply cannot accept a real recession is happening.
You can find numerous references on this blog that we do not belong to the irrational optimists, although we have plenty of faith in humanity as a whole, and are in fact very optimistic!"

Nokia profit drops 69 percent in fourth quarter
Sony forecasts first annual net loss in 14 years
Microsoft announced the cuts as it reported an 11 percent drop in second-quarter profit, which fell short of Wall Street's expectations. Microsoft shares plunged almost 11 percent in midday trading.

China GDP shows slowdown

China GDP shows slowdown
(01:43) Reuters Video Report

Jan 22 - Fresh economic data shows China's economy slowing down dramatically, while officials say stability is the top priority for a bleak 2009.
Although authorities said the slowdown was only temporary, it did snap a five-year streak of double-digit growth that has turned China into the third-largest economy in 2008 after the United States and Japan.

The Obama Stimulus Plan

The Obama Stimulus Plan

President Obama wants to spend 75 percent of the $825 Billion Stimulus Plan in the first 18 months.
There is a resistance from the Republican party to large amounts for 'economic stimulus packages' and that's why the Obama administration on Wednesday said $3 of every $4 in the package should be spent within 18 months to have maximum impact on jobs and taxpayers. Policy makers want to see results fast and clear!

Peter Orszag, the director of the White House Office of Management and Budget, said Wednesday that if House or Senate versions of the bill do not spend the money as quickly, the White House will work with lawmakers to achieve the 75 percent goal. Congress is working on a stimulus bill of at least $825 billion.
In an interview with the Associated Press, Orszag responded to a Congressional Budget Office assessment that money targeted for infrastructure under a House proposal would take years to be spent. He said the issues identified by CBO could be easily corrected.
"There are relatively straightforward changes to increase the spend-out on that part of the bill,"

Press Release Open Davos Forum World Economic Forum, January 21st

World Economic Forum, Annual Meeting 2009 - "Shaping the Post-Crisis World", Davos-Klosters, Switzerland, 28 January - 1 February 2009 Website WEF

Press Release WEF, Geneva, Switzerland, 21 January 2009 – The World Economic Forum today unveiled the programme for its 39th Annual Meeting in Davos-Klosters. The overarching theme of the meeting, which will take place from 28 January to 1 February, is “Shaping the Post-Crisis World”. Over the course of the five-day meeting, more than 2,500 participants from 96 countries will convene in Davos-Klosters, Switzerland, including a record 41 heads of state or government. Key finance, foreign affairs, trade and energy ministers will join heads of non-governmental organizations, social entrepreneurs and religious leaders at the Meeting. Around 60% of the participants are business leaders drawn principally from the Forum's members – 1,000 of the foremost companies from around the world and across all economic sectors.

As well as looking at the immediate crisis and ways to stabilize and relaunch the global economy, the Annual Meeting programme also pinpoints a number of interrelated global risks including climate change, food and water security. The Meeting will also consider the institutions that the world needs to cooperate and confront global challenges and will look to improve the ethical value base for business as a constructive social actor.

Speaking at a press conference at the World Economic Forum’s headquarters in Geneva, Founder and Executive Chairman Professor Klaus Schwab said: “The Annual Meeting 2009 is one of the most crucial in the near 40 year history of the World Economic Forum. The extraordinary participation in terms of political and business leaders and other stakeholders demonstrates that our Annual Meeting will be the place where key actors can address both a crisis of unprecedented scope and, at the same time, the sort of world we collectively want to see emerging once the crisis is over. What we are experiencing is the birth of a new era, a wake-up call to overhaul our institutions, our systems and, above all, our way of thinking.”

The Meeting’s programme will follow six programmatic tracks that are high on the global agenda in 2009. These include Promoting Stability in the Financial System and Reviving Global Economic Growth; Ensuring Effective Global, Regional and National Governance for the Long Term; Addressing the Challenges of Sustainability and Development; Shaping the Values and Leadership Principles for a Post-Crisis World; Catalysing the Next Wave of Growth through Innovation, Science and Technology; and Understanding the Implications on Industry Business Models.

On Inauguration Day U.S. Markets closed lower

On Inauguration Day U.S. Markets closed lower

On the day of the Inauguraion of President Barack Obama the U.S. markets closed down by 4 and more than 5 percent. Asian and European markets were already very weak about dismal economic news and the continuing weakness in the banking sector. Especially the U.K. banks were very weak.

On Wednesday the 21st of January Asian markets closed down with 1 and 2 percent losses.
At 10.00 hours in Amsterdam the European markets showed weakness with losses of around 1 and 2 percent. The British Pound hit a seven and half years low against the dollar, with the UK banking sector continuing to suffer.
In Amsterdam (AEX) the financials were hit.
For Wallstreet the futures point to a stronger opening.
IBM came up with a very optimistic forecast for 2009. The Tech sector seems to be one of the gainers today.

Although dire predictions and dismal figures about the economy will prevail for the coming months, the seeds of a new optimism are planted. However, the whole global economy cannot be turned around within a few months and all the rot is not out of the financial system yet.
In the main part of the EU, which lacks inspiring and creative new leaders and which is plagued by a heavy and unflexible bureacratic system, things could turn much worser before improvement sets in.

Global U.S.A (Obama) adversaries beginnig to speak out (Bloomberg.com)
In places where the U.S. is considered an adversary, many citizens expressed skepticism that Obama, who pledged in his inaugural address yesterday to “seek a new way forward,” will be able to overcome decades of hostility.

IBM forecasts surprisinglly good earnings for 2009

IBM Reports 2008 Fourth-Quarter and Full-Year Results
IBM forecasts surprisinglly good earnings for 2009

(ARMONK, NY - 20 Jan 2009)

Full-Year 2008:

* Record revenue of $103.6 billion;
* Record pre-tax profit of $16.7 billion;
* Record earnings per share of $8.93;
* Record free cash flow of $14.3 billion, up $1.9 billion, excluding Global Financing receivables.

Full-Year 2009:

* Earnings-per-share expectation of at least $9.20.

Fourth-Quarter 2008:

* Diluted earnings of $3.28 per share, up 17 percent;
* Net income of $4.4 billion, up 12 percent;
* Gross profit margin of 47.9 percent, up 3 points;
* Revenue of $27.0 billion, impacted by strong U.S. dollar, down 6 percent, down 1 percent adjusting for currency;
* Software revenues up 3 percent, up 9 percent adjusting for currency; pre-tax income up 15 percent;
* Global Technology Services revenue down 4 percent, up 3 percent adjusting for currency; pre-tax income up 35 percent;
* Global Business Services revenues down 5 percent, flat adjusting for currency; pre-tax income up 26 percent;
* Services signings of $17.2 billion, 24 deals greater than $100 million;
* Strategic outsourcing signings up 20 percent worldwide, up 44 percent in North America.

For the full press release, go to the website...

PRESIDENT OBAMA'S AMERICAN RECOVERY AND REINVESTMENT PLAN

THE PRESIDENT'S AMERICAN RECOVERY AND REINVESTMENT PLAN

(From The White House Site)
With each passing day, families across America are watching their bills pile up and their savings disappear.

President Obama believes that if we do not act quickly, this recession could linger for years – and America could lose the competitive edge that has served as the foundation for our strength and standing in the world.
That's why the President has put forth an American Recovery and Reinvestment Plan that will jumpstart job creation and long-term growth by:

* Doubling the production of alternative energy in the next three years.
* Modernizing more than 75% of federal buildings and improve the energy efficiency of two million American homes, saving consumers and taxpayers billions on our energy bills.
* Making the immediate investments necessary to ensure that within five years, all of America’s medical records are computerized.
* Equipping tens of thousands of schools, community colleges, and public universities with 21st century classrooms, labs, and libraries.
* Expanding broadband across America, so that a small business in a rural town can connect and compete with their counterparts anywhere in the world.
* Investing in the science, research, and technology that will lead to new medical breakthroughs, new discoveries, and entire new industries.
Dancing Presidential
(01:08) Reuters VideoReport

Jan 20 - President Barack Obama and First Lady Michelle arrive for the first of a series of Inaugural Balls.
Throughout the evening, the Obamas will attend an expected 9 inaugural balls.

RBS shares plunge on record loss

RBS shares plunge on record loss

(BBC) Royal Bank of Scotland shares have plunged 67% after the bank said it was heading for a record loss.
The bank said it expects to report a deficit before write-downs of between £7bn and £8bn for 2008.
It will also write down assets, largely related to its takeover of ABN Amro in 2007, of up to £20bn in 2007.
RBS's final deficit is set to beat Vodafone's 2006 loss of £15bn, the current UK record. The bank also said jobs would go because of the downturn. The firm's shares ended Monday trading down 23.1 pence to 11.6p.
As part of the government's package to rescue British banks announced on Monday, the Treasury said it would swap £5bn of preference shares for ordinary shares in the bank, taking its stake in RBS to nearly 70%.


Brown accuses RBS of taking ‘irresponsible risks’
Bank’s shares fall 70% after bail-out

(FT video) Gordon Brown on Monday unveiled a second bank rescue package including powers for the Bank of England to lend up to £50bn directly to businesses, as he accused the Royal Bank of Scotland of taking ”irresponsible risks” as the bank’s shares collapsed.
His comments came as RBS on Monday warned it could report an annual loss of up to £28bn, following the mis-timed acquisition of ABN Amro, the Dutch lender it acquired as part of a €71bn (£63bn) hostile break-up bid in 2007.

Let's enjoy these days.

Let's enjoy these days, tough times ahead but at the end of the day things will be better!

Stars come out for Obama concert
(01:32) Reuters Video Report
Jan. 18 - Tens of thousands brave the winter cold for a concert on the National Mall in honor of Obama's inauguration.
Performers included Mary J. Blige, Bon Jovi, Garth Brooks, Beyonce and U2.

Warren Buffett's Dateline Interview with NBC's Tom Brokaw: The Complete Transcript,

Warren Buffett's Dateline Interview with NBC's Tom Brokaw: The Complete Transcript,

Buffett tells Brokaw that Barack Obama is the right "commander in chief for the economy" but warns that no one should expect a "miracle" turnaround in the next few months.
Buffett and Brokaw also covered many other topics, including Obama's leadership style, excessive executive compensation, the challenges facing Detroit's automakers, China, and the role of greed in good times and bad.
This is the complete transcript of that interview, as provided by NBC News


TOM BROKAW, NBC NEWS:

(UNINTEL)-- pollster told me that the election was between hope and fear. When it comes to the economy, who's winning, hope or fear?

WARREN BUFFETT:

Well, right now fear is. I mean, you're seeing it everyplace. You saw it at-- in the sales of almost every item at-- at Christmas. There's a lot of fear throughout the country. Even-- even with people whose jobs are fine, and who have money in the bank. But they-- they're worried.

BROKAW:

I've been describing this as the domestic equivalent of war. Is that an overstatement?

BUFFETT:

Well, actually, in September I said-- this is an economic Pearl Harbor. I-- that was the time congress had made it in. It really is an economic Pearl Harbor. It-- the-- the country is facing something it hasn't faced since World War II.

And they're fearful about it. And they don't know quite what to do about it. And the point is-- and-- and it-- and temporarily it looks like we're losing. It has that-- that same aspect. Interestingly enough, we were losing for a while after Pearl Harbor. But the American people never doubted that we'd win. I mean, we had that attitude then. I think, right now, that they're sort of paralyzed.

Read The Complete Transcript...

U.S. Stock markets are closed on Monday

Monday the 19th of January the American stock markets are closed for a National Holiday, Martin Luther King Day.
On Tuesday the 20th we have Inauguration Day when Barack Obama will be sworn in as the 44th president of the United States. Public Offices will be closed but the Stock Markets remain open.
Around 180 Companies are reporting results this week.
Traders expect stocks to get a boost from the Inauguration, but diappointing earnings and results could dampen the enthousiasm.
The 4th Quarter earnings are the most important indication for the markets at the moment and going to set the direction for the coming months.
The market has largely written off the first half of 2009 and the upcoming bad news is mostly incalculated. Unexpected (good or bad news) events can however have a large impact on the mood of the day and on the global markets. Investors risk their money and they want returns, not words, plans or promises.

In Europe the recession is just beginning

Europe had "catastrophic" 4th quarter: EU Verheugen
BERLIN (Reuters) - The European economy is sliding deeper into recession and the fourth quarter of last year was "catastrophic," European Union Industry Commissioner Guenter Verheugen said on Sunday.
"The figures the European Commission will present next week will, unfortunately, show that we have slipped deeper into recession," Verheugen told German radio DeutschlandFunk.
"The last quarter of 2008 was catastrophic in every respect."
It was unclear whether he was referring to the euro zone or the wider European economy. The European Commission is due to present its forecasts for the euro zone next week.

Do you want to know what Obama is focussing on?

Obama's green energy push spotlights Ohio biz
Obama's stimulus sales trip this week will feature Cardinal Fastener, a manufacturing company that has reinvented itself for the alternative-energy future.

(CNNMoney.com) -- Never mind Joe the Plumber; meet John the Manufacturer. That's what President-elect Barack Obama will be doing Friday, when he stops in Ohio to pitch his $825 billion economic recovery and job creation package.
While in Bedford Heights, Ohio, Obama will be touring the Cardinal Fastener & Specialty Company, a local manufacturing company that supplies steel screws, washers and bolts to industries such as construction and mining. The company is a carefully chosen poster child for Obama's stimulus plans: While so many manufacturers struggle with slowing sales, Cardinal Fastener is growing and adding staff, thanks to its focus on the green energy industry.
"People call it the next automotive industry for the United States," said John Grabner, 56, president and owner of Cardinal.

The small company is about to take the spotlight on a big stage - Grabner had to cut short an interview because a batch of Secret Service agents showed up at his door

Eclipse Auction Draws No New Qualified Bids

Eclipse Auction Draws No New Qualified Bids

Jan 14, 2009 (Aviation Week)
As the deadline for filing intentions to bid for the assets of insolvent Eclipse Aviation in US Bankruptcy Court, District of Delaware, expired at close of business on Tuesday, January 13th, EclipseJet Aviation International, a subsidiary of Roel Pieper's Luxembourg-based ETIRC, remained the sole bidder.
In the absence of qualified competitive bidders, US Bankruptcy Court Judge Mary Walrath, who is handling the Eclipse case, is due to hear motions to sell Eclipse's assets to EclipseJet on Friday, January 16th.
ETIRC currently is Eclipse Aviation's largest shareholder. Pieper, acting as president of Eclipse since its Board of Directors axed company founder Vern Raburn in late July 2008, knows more about its finances and failed relationships with vendors and suppliers than anyone now associated with the firm. For an offering of $28-million in cash, plus $160-million in new equity notes, Pieper now expects that his EclipseJet Aviation subsidiary will be the new owner of Eclipse in less than one week.

The European Technology and Investment Research Center (ETIRC). In the world of Investment and Development Banking, ETIRC is a reliable and trusted Gateway into Russia and the CIS, providing a strong economical, technical and political network. ETIRC is also active in Turkey, Ukraine, Kazakhstan and Israel.

Mr. Pieper was Senior Vice President of Strategy at Philips N.V. from 1998-1999. Prior to that, he was the President and CEO of Tandem Computers Inc., the largest fault-tolerant computer vendor with revenues in excess of $2 billion in 1995, backed by Kleiner Perkins. While at Tandem, he was responsible for a turnaround initiative that resulted in a trade sale to Compaq Computer. Mr. Pieper began his software career at Software AG where he spent 10 years in the US and Germany during which time he became Chief Technology Officer of the company. Software AG is considered one of the earliest software companies in Europe and at one time was the second largest global software company


January 13, 2009
Eclipse Auction Cancelled (Source AP)
The Associated Press is reporting that a public auction to sell the assets of Eclipse Aviation Wednesday has been cancelled for lack of qualified competing bidders. According to AP's story, that will pave the way for EclipseJet Aviation, owned by current Eclipse Chairman Roel Pieper, to pick up the company for roughly 20 cents on the dollar. ETIRC is proposing to pay $188 million ($28 million cash, $160 million in new notes) and offer 15-percent equity to senior secured creditors. Eclipse's total liability was estimated at more than $1 billion when it filed for Chapter 11 protection in late November.
It was rumored that there were at least two competing bids for Eclipse but if there were other bids they were not considered to be qualified. Two committees of secured creditors and a committee of unsecured creditors who reviewed the bid(s) determined that there were no qualified bids, Eclipse lawyer Dan Guyder told the AP.

ECB cut base rates 0.50 points

European Central Bank cuts rates to 2 percent
European Central Bank cuts interest rates by half percentage point to 2 percent

FRANKFURT, Germany (AP) -- The European Central Bank cut its interest rates by a half percentage point to 2 percent on Thursday, moving to protect the continent's economy against a deep recession amid increasingly grim economic data.
The decision to cut the main refinancing rate from 2.5 percent was in line with market expectations and left the rate at its lowest level since December 2005. It followed a three-quarter point cut last month.
"Despite some apparent earlier reluctance to cut interest rates significantly in January after reducing them by 175 basis points over the previous three months, the ECB really had little option but to act again given the clear, widespread evidence that the euro zone recession is deepening," IHS Global Insight economist Howard Archer said after Thursday's decision.
With euro zone inflation heading lower, "the ECB had ample scope to cut interest rates further," he argued.
The ECB has now reduced interest rates on four occasions since October from a high of 4.25 percent, though it has stopped short of the more aggressive cuts enacted by the U.S. Federal Reserve and the Bank of England.


ECB expected to cut base rates at least 0.50 points (Thursday January 15th)
Mr. Trichet (and the ECB) does not really want to cut base rates with more than 0.50 points, but with the rapidly deteriorating economic situation in the Euro Zone he faces an immense outside pressure.
Stock Markets are down for the year (2009) with more than 10 percent.
Bank crisis deepens as ECB rate cut expected

FRANKFURT/TOKYO (Reuters) – Bank of America and Citigroup faced fresh turmoil as investors questioned if they had the capital strength to cope with a global crisis that is set to push the European Central Bank to cut rates later on Thursday.
Data across the developed world pointing to a deepening recession and fears that more public money in the United States may be needed to keep banks afloat weighed on financial markets.
Asian equities followed European and U.S. markets to fall to multi-week lows. Tokyo's Nikkei average slipped close to 5 percent after news that Japan's core machinery orders fell at a record pace in November.
Shares in Bank of America and Citigroup, two of America's biggest banks, fell as they faced a fresh crisis of confidence over whether they have enough capital to cover hemorrhaging losses from toxic assets and the struggling global economy.
"The large banks in the U.S. are not lending, and they're desperate to conserve capital," said Dan Alpert at Westwood Capital in New York. "Banks only remain going concerns because the federal government is topping up their equity."

You say we are looking at a deep and possibly multiyear recession in America

Columbia's Amar Bhidé and NYU's Nouriel Roubini
"When you have an integrated global economy…there are not many places to hide because markets [and economies] become correlated".

January 7, 2009, Business Week Interview by Maria Bartiromo for her Business Week column:
"You say we are looking at a deep and possibly multiyear recession in America; an additional 15% drop in U.S. home prices; painful recessions in Europe, Canada, Japan, and other established economies; a sharp slowdown in China, India, Russia, and Brazil; and possibly default by some emerging-market countries. Can anything stop this locomotive bearing down on us?"
Interview in Business Week, read whole article...

Bad day for the markets in Europe and the U.S. (Jan 14th)

Bad day for the markets in Europe and the U.S.

European Markets were hit by the bad news from the U.S. and sank between 4 and 5 percent today. Walstreet got hammered by the bad news from the retail sector and continuing worries about the banking sector.
At this hour (Amsterdam, 21.20 CET) the main U.S. indexes are down well over 3 percent with the NASDAQ going to minus 4 percent. The DJIA is going towards the 8000 level again.
The outlook for the Asian Markets tomorrow looks pretty grim.
Oil dropped below $37.- on economic worries, bulging inventories and lower demand forecasting. Google shares kept barely above $300.-.
We saw today even signs of worry from the Dutch Government, they are beginning to understand the Netherlands cannot escape the recession.

Nortel Networks goes into bankruptcy

Nortel Networks goes into bankruptcy
The long, steady fall from grace of Nortel Networks hit bottom Wednesday when the phone-equipment maker filed for Chapter 11 bankruptcy protection in the United States, along with seeking protection from creditors in its home base of Canada and in Europe.
Nortel (NYSE: NT), whose U.S. base in Richardson employs at least 3,600 people, made the filing in Delaware a day before the deadline for the company to make a $107 million interest payment.
The company’s staffing levels in Richardson have dwindled over the years as Nortel went through a series of restructurings aimed at coping with a tough business climate.

Nortel is Sponsor for the 2012 Olympc Games
The Toronto-based technology giant signed up as one of London's domestic "tier-one" sponsors in July, committing to provide about $58 million in cash and the network infrastructure to operate communications with partner British Telecom.
Nortel, which is also a supplier for the 2010 Vancouver Winter Olympics along with Bell Canada, filed for court protection on Wednesday, a day before the firm is due to repay a $107 million interest debt on bonds.

China raises '07 economic growth, passing Germany

China raises '07 economic growth, passing Germany
China passes Germany to become world's 3rd-largest economy after 2007 GDP revision

BEIJING (AP) -- China surpassed Germany to become the world's third-largest economy behind the United States and Japan after Beijing on Wednesday raised its estimate of economic growth in 2007.
The status is symbolic -- China's 1.3 billion people are, on average, among the world's poorest -- but reflects the country's explosive growth as it became the world's factory and a trading power over 30 years of economic reform.
The government revised its estimate of 2007 economic growth from an already high 11.9 percent to an eye-popping 13 percent, the fastest rate since 1994.
That raised China's gross domestic product to 25.7 trillion yuan, or $3.5 trillion at 2007 exchange rates, the national statistics agency said. That would be ahead of Germany's 2007 GDP of 2.4 trillion euros, or $3.3 trillion at an exchange rate produced by averaging rates on the 15th of each month during that year. Based on only Dec. 31, 2007, exchange rates, China was slightly behind Germany but would have passed it early last year.

The danger of keeping rates at zero

The danger of keeping rates at zero
The Fed seems to think inflation is no longer a problem. But inflation may just be in hibernation and low rates for a long period of time could awaken the beast.


NEW YORK (CNNMoney.com) -- This is obviously a terrible time for the economy. For that reason, it made sense for the Federal Reserve to slash interest rates near zero last month.
But I'm starting to worry a bit that the Federal Reserve is willing to leave rates this low for too long and that this could spark inflation down the road.
In a speech in London Tuesday morning, Federal Reserve chairman Ben Bernanke defended the Fed's series of rate cuts since September 2007, saying that inflation was no longer a major concern. The Fed usually raises interest rates when it is worried about inflation.
"At this point, with global economic activity weak and commodity prices at low levels, we see little risk of inflation in the near term; indeed, we expect inflation to continue to moderate," he said. Read article...

ING gaat deel van Kunstcollectie verkopen.

ING gaat deel van Kunstcollectie verkopen.

Zie Bericht op Kunstjaar 2009 Blog: ING to Sell Work From Its Collection

Volgens Persbureau Bloomberg gaat ING (voor het eerst sinds 1974) een deel van de kunstcollectie verkopen. ING (ING Art Mangement) heeft ongeveer 25.000 kunstwerken in bezit waaronder werken van Karel Appel, Michael Raedecker, en Diego Rivera. De bedoeling is om ongeveer een tiende deel van de totale verzameling te verkopen op eBay, in porties van 50 stuks per week. Het Geheugen van Nederland (Netherlands Institute for Cultural Heritage) verzorgt de verkoop, een deel van de opbrengst gaat naar het ING Chances for Children een organisatie onder de Unicef paraplu.

Volgens Annabelle Birnie van ING Art zal de ING gewoon doorgaan met het aankopen van kunst, maar gezien de huidige situatie op de financiële markten op een bescheiden manier.

Conjuctuur Nederland Persbericht CBS, donderdag 8 januari 2009

Conjuctuur Nederland Persbericht, donderdag 8 januari 2009

De Nederlandse inflatie is in december uitgekomen op 1,9 procent. Dat is 0,4 procentpunt lager dan in november. De inflatie is voor de vierde maand op rij lager dan een maand eerder. De daling is net als in november het gevolg van fors lagere prijzen van autobrandstoffen. Dit blijkt uit cijfers van het CBS.

Inflatie daalt naar 1,9 procent

* Opnieuw lagere inflatie door dalende autobrandstofprijzen
* Inflatie in 2008 gemiddeld 2,5 procent
* Nederlandse inflatie in december hoger dan in eurozone

De gemiddelde inflatie is in 2008 uitgekomen op 2,5 procent. In de eerste helft van het jaar liep de inflatie sterk op van 2,0 procent in januari tot 3,2 procent in juli. Deze toename was het gevolg van gestegen brandstof- en voedselprijzen. Ook de aanpassing van de tarieven voor gas en elektriciteit in juli hadden een sterk verhogend effect. Vanaf september begon de inflatie te dalen. Dit kwam vooral doordat autobrandstoffen flink goedkoper werden. De prijzen van voedsel stegen nog wel, maar veel minder sterk dan in de eerste helft van het jaar. Verder is in de loop van 2008 de accijns op diesel en tabak verhoogd en werd de vliegtaks ingevoerd.

Persbericht, donderdag 8 januari 2009 9:30. Download PDF met het volledige persbericht inclusief tabellen en grafieken.

Conjunctuurbericht, dinsdag 13 januari 2009 9:30
Uitzonderlijk grote terugval omzet industrie

De ondernemers in de industrie behaalden in november 2008 bijna 14 procent minder omzet dan in november 2007. Dit is de grootste afname sinds de start van de reeks begin jaren negentig. Medio 2004 was de omzet voor het laatst lager dan een jaar eerder.

November telde in 2008 twee werkdagen minder dan in 2007. Het negatieve effect hiervan op de omzetontwikkeling wordt geraamd op circa 5 procent. De door de industrie verkochte producten waren bijna 2 procent goedkoper dan in november 2007.

Op de binnenlandse markt realiseerde de industrie in november bijna 13 procent minder omzet. Op de exportmarkt was de omzet ruim 14 procent kleiner. De in het buitenland behaalde omzet was in oktober al lager dan een jaar eerder. De lichte afname werd toen echter gecompenseerd door een toename van de omzet op de binnenlandse markt. De totale omzet van de industrie was in oktober iets hoger dan in oktober 2007

Stocks slide on Monday Jan, 12th

Stocks slide on Monday Jan, 12th

Stocks went down on Monday the 12th of January on Wallstreet.
Citi shares went down despite talks with Morgan. Oil slipped below $38 dollar per barrel after weakening demand outlook. Falling commodity prices dragged energy stocks lower and reinforced fears that a slowing economy will further erode corporate profits. After bad news and outlooks in the past weeks, Wall Street is expecting fourth-quarter and full-year numbers arriving this week to be particularly bleak. Just before the bell the Down Jones (DJIA) was was off around 1.4 percent, the NASDAQ and the S&P 500 slipped about 2 percent.
The market is in anticipation of the 4th quarter and full year figures. Traders are cautious!

IMF Spells Out Need for Global Fiscal Stimulus

IMF Spells Out Need for Global Fiscal Stimulus
IMF Survey online December 29, 2008

As the world struggles to contain the continued fallout from the financial crisis, attention has shifted from rescuing failing financial institutions to supporting domestic demand, which has fallen off sharply almost everywhere.
In November, the IMF cut its forecast for global growth by ¾ percentage point to 2.2 percent for 2009. But, with the crisis spreading rapidly, IMF First Deputy Managing Director John Lipsky has said that the Fund is likely to make further downward revisions in the new global forecast it will announce in January 2009.
In this interview, Olivier Blanchard, Economic Counsellor, and Carlo Cottarelli, Director of the Fiscal Affairs Department, flesh out the call for a global fiscal stimulus, first proposed by IMF Managing Director Dominique Strauss-Kahn in the context of the November 15 emergency summit called by the leaders of the Group of 20 (G-20) industrialized and emerging market economies.Read article...

The International Monetary Fund’s Managing Director Dominique Strauss-Kahn said in a Jan. 9 interview that governments in Western Europe are “behind the curve” in implementing stimulus packages and are “underestimating the needs.” He said the full impact of the slump hasn’t hit the region, where “shops are still full.”

Fiscal Policy for the Crisis (pdf)

Audacity itself as economic experiment

President-elect Obama proposes an unparalleled test of Keynes' decades-old idea: that deficit spending on a grand-enough scale can inspire the confidence to right a sinking economy.

(Source Los Angeles Times)
President-elect Barack Obama will soon unveil a package of tax cuts and spending increases that, combined with already planned spending, would push Washington's 2009 deficit to between $1.5 trillion and $2 trillion -- more than 10% of the economy's output. And he will argue that this tidal wave of federal expenditure should continue into next year, and perhaps beyond.
Only during World War II did U.S. government expenditures account for a greater share of economic activity, according to federal statistics. That's also true for virtually every other developed country. Read the whole article...

Protectionism risks rise in 2009-2010

Protectionism risks rise in 2009-2010

Parallels with the 1930s abound. But the tariff wars of the 1930s belong to a vanished world of fixed exchange rates, militarism and failed multilateralism. The tariff history of the 1930s is not a good parallel for today’s world.
The real risk is a more insidious undeclared trade conflict based on rises in applied rates, non-tariff barriers, bad faith, and an upsurge in trade defenses as countries try to “allocate” scarce demand and placate industries and workers under particular pressure. Read more on John Kemp's blog...

In the first months of this blog, we gave some attention to cars and the auto industry...

In the first months of this blog, we gave some attention to cars and the auto industry..., but from now on we think it is better to post all item related to Future Cars on our Blog Tendsbridge.

The Blog Trendsbridge is about current and emerging trends.
Trends in the modern world and society, innovation and new trends in art and lifestyle, trends in the economy, business and technology.

The Housing Market, the Transportation Sector and the Auto-Industry are very important sectors in our Economy, and we are convinced the signs of a 21st Century Economy, mentality and technology will show up in these sectors.

For instance Toyota is working in secret on a new solar-technology powered vehicle, but it is still a secret and we do not know much about it.
We noticed this is generating quite a lot of interest from Japanese visitors.
Toyota-Future has an excellent and educating interactive website,.
Check Toyota-Future.com to get an insight of what Toyota is working on.

U.S. unemployment rate rose from 6.8 to 7.2 percent in Decenber 2008

THE EMPLOYMENT SITUATION: DECEMBER 2008

2008's total job loss 2.6 million, the highest yearly job-loss total since 1945.
Nonfarm payroll employment declined sharply in December, and the unemployment
rate rose from 6.8 to 7.2 percent, the Bureau of Labor Statistics of the U.S.
Department of Labor reported today. Payroll employment fell by 524,000 over the
month and by 1.9 million over the last 4 months of 2008. In December, job losses
were large and widespread across most major industry sectors.
Unemployment (Household Survey Data)

In December, the number of unemployed persons increased by 632,000 to 11.1 mil-
lion and the unemployment rate rose to 7.2 percent. Since the start of the reces-
sion in December 2007, the number of unemployed persons has grown by 3.6 million,
and the unemployment rate has risen by 2.3 percentage points. (See table A-1.)

The unemployment rates for adult men (7.2 percent), adult women (5.9 percent),
and whites (6.6 percent) increased in December. The jobless rates for teenagers
(20.8 percent), blacks (11.9 percent), and Hispanics (9.2 percent) were little
changed over the month. The unemployment rate for Asians was 5.1 percent in Decem-
ber, not seasonally adjusted. (See tables A-1, A-2, and A-3.)

Among the unemployed, the number of job losers and persons who completed tempo-
rary jobs rose by 315,000 to 6.5 million in December. Over the past 12 months, the
size of this group has increased by 2.7 million. (See table A-8.) The number of
long-term unemployed (those jobless for 27 weeks or more) rose to 2.6 million in
December and was up by 1.3 million in 2008. (See table A-9.)

See all 2008 tables on this link

Quantitative easing is next?

Quantitative easing is next?

In short, the printing of money. To unclog the system?
We are beginning to hear the 'D' word, ... Depression!

What is quantitative easing?

Quantitative easing has begun.
Quietly, without fanfare, the Federal Reserve has turned on the printing presses. The central bank is flooding the market with enough excess liquidity to refloat the banking system — and hopes to generate an upturn in both economic activity and inflation in the next 12-18 months to prevent the economy falling into a prolonged slump.
Since the banking crisis intensified in September, the Fed has been rapidly expanding the credit side of its balance sheet, providing an ever-increasing array of facilities to support the financial system (repos, term auction credit, primary discount credit, broker-dealer credit, commercial paper funding, money market mutual fund liquidity and term securities lending).

This link could be interesting as well but it's a bit wilder and more speculative.
Quantitative Easing: The Kick Start Of Gold’s Move To $1200 and $1650...

Update Madoff Mess (January 8th 2009)

Update Madoff Mess (January 8th 2009)

As it turns out Bernie Madoff is also responsible for a couple of hundred million in Labor Union Pension Funds losses (Carpenters Union).
Another development, investigators found 100 signed checks worth $173 million in Bernard Madoff's office desk that he was ready to send out to his closest family and friends at the time of his arrest last month.
He also was accused of sending more than $1 million worth of jewelry to friends and family over the holidays, prompting prosecutors to ask a judge to revoke his bail.

'Casualties of War:' Lousy Returns, Madoff Scandal Spell Doom for Hedge Funds
After the average hedge fund lost 23% last year, according to Reuters, investor confidence was further shaken by the Bernie Madoff scandal, which will only increase the regulatory scrutiny on the industry.

Madoff bail to be decided on Monday January 12th
CNN Money and Fortune wrap up the complete Madoff Mess in a special report.
http://money.cnn.com/news/specials/madoff/

Boston hedge fund shuttering after Madoff bet
Fri Jan 9, 2009 3:26pm EST

BOSTON (Reuters) - Hedge-fund firm GMB Capital Management is shutting down a fund that lost more than $50 million on bad bets that included putting money with accused swindler Bernard Madoff, according to sources familiar with the matter.
The Boston-based GMB Low Volatility Fund LP, which had more than $100 million in assets, began liquidating late last year, the sources said.
GMB Capital is run by Massachusetts Institute of Technology professor Gabriel Bitran and his son Marco.
Low Volatility Fund once wooed investors with the promise that it would rely heavily on Bitran's complicated algorithms to deliver low volatility where prices almost never change. Instead, the father and son team appears to have done exactly the opposite, funneling a big chunk of money to Madoff, a financier accused last month of running a $50 billion Ponzi scheme, the sources said. Read more...

December €-coin still points to negative underlying growth in the euro area

December €-coin still points to negative underlying growth in the euro area
In December €-coin remained below zero, confirming the November reading and estimating euro area underlying growth at -0.15% (-0.14% in November).
Read the CEPR (Center for Economic Policy Research) Press release (download PDF)

CEPR's research is conducted by a network of over 700 researchers who retain their academic bases. The Centre helps these Fellows and Affiliates develop and obtain funding for research, administer and execute these projects and disseminate the results of the research

The First Global Financial Crisis of the 21st Century

The First Global Financial Crisis of the 21st Century

This book is available to download for free. Go to the website and click on the links to download either the full book or individual sections and the preface, introduction, chronology and glossary.

The First Global Financial Crisis of the 21st Century
(A VoxEU.org Publication - Edited by Andrew Felton and Carmen M. Reinhart)

Preface
Introduction

Section 1 Why Did the Crisis Happen?

The relationship between the recent boom and the current delinquencies in subprime mortgages
Giovanni Dell'Ariccia, Deniz Igan and Luc Laeven

Why bank risk models failed
Avinash Persaud

Blame the models
Jon Danielsson

The subprime crisis: observations on the emerging debate
Charles Wyplosz

The subprime series, part 1: Financial crises are not going away
Stephen G. Cecchetti

The subprime series, part 2: Deposit insurance and the lender of last resort
Stephen G. Cecchetti

The subprime series, part 3: Why central banks should be financial supervisors
Stephen G. Cecchetti

The subprime series, part 4: Does well-designed monetary policy encourage risk- taking?
Stephen G. Cecchetti

The subprime crisis: Greenspan’s Legacy
Tito Boeri and Luigi Guiso

The impact of short-term interest rates on risk-taking: hard evidence
Vasso Ioannidou, Steven Ongena and Jose Luis Peydró

Why did bank supervision fail?
Guido Tabellini

The subprime crisis and credit risk transfer: something amiss
Luigi Spaventa

The crisis of 2007: some lessons from history
Michael D. Bordo

Reflections on the international dimensions and policy lessons of the US subprime crisis
Carmen Reinhar
Section 2 How Is the Crisis Unfolding?

Federal Reserve policy actions in August 2007: frequently asked questions (updated)
Stephen G. Cecchetti

An extensive but benign crisis?
Tommaso Monacelli

Not (yet) a ‘Minsky moment’
Charles W. Calomiris

A B & B future for subprime borrowers?
Willem Buiter

Double counting 101: the useful distinction between inside and outside assets
Willem Buiter

Bagehot, central banking and the financial crisis
Xavier Vives

The financial crisis: why it may last
Angel Ubide

Fallout from the credit crunch
Dennis J. Snower

Four mega-dangers international financial markets face
Dennis J. Snower

Federal Reserve policy responses to the crisis of 2007–8: a summary
Stephen G. Cecchetti

While the ECB ponders, the Fed moves – and cleverly at that
Charles Wyplosz

Section 3 What Can Be Done?

The subprime crisis: Who pays and what needs fixing
Marco Onado

Filling the information gap
Alberto Giovannini and Luigi Spaventa

Lessons from the North Atlantic financial crisis
Willem Buiter

Lessons from Northern Rock: banking and shadow banking
Willem Buiter

Lessons from Northern Rock: how to handle failure
Willem Buiter

Ratings agency reform
Richard Portes

How to avoid further credit and liquidity confidence crises
Guillermo de la Dehesa

The inappropriateness of financial regulation
Avinash Persaud

There is more to central banking than inflation targeting
Paul De Grauwe

Can monetary policy really be used to stabilize asset prices?
Katrin Assenmacher-Wesche and Stefan Gerlach

A missed opportunity for the Fed
Willem Buiter and Anne Sibert

The central bank as the market-maker of last resort: from lender of last resort to market-maker of last resort
Willem Buiter and Anne Sibert

Avoiding disorderly deleveraging
Luigi Spaventa

Chronology
Glossary

Hard copy from Amazon.com ( Unfortunately Out of Print--Limited Availability.)

UK: BoE cuts interest rates to record low of 1.5 percent

UK interest rates cut to record low of 1.5 percent

LONDON (AP) -- The Bank of England has cut official interest rates by half a percentage point to 1.5 percent, the lowest level in its 315-year history as it attempts to ward off a prolonged recession.Thursday's cut means British central bankers are moving closer to the limits of conventional monetary policy after trims totaling three percentage points since the beginning of October.Britain faces its bleakest year since the early 1990s recession. House prices have suffered their worst year on record, the huge services sector is shrinking at a record pace and several major retailers have collapsed as consumers curb spending.

Inflation is expected to fall from 4.1 percent currently to well below the government's 2 percent target, heading toward destabilizing negative inflation.

Economic Survey of the Euro area - news conference on Wednesday 14 January 2009

Economic Survey of the Euro area - OECD news conference on Wednesday 14 January 2009

07/01/2009 - Strengthening the financial system in the wake of the current crisis is one of the key challenges discussed in OECD’s latest economic survey of the Euro area, to be published on Wednesday 14 January 2009.
The survey will be available to journalists in English on OECD's password-protected website at 10.30 a.m. Paris time (09.30 GMT) for immediate release.
A news conference presented by OECD Secretary-General Angel Gurría, senior economist Nigel Pain and division head Peter Hoeller will be held at 10.30 a.m. the same day (in English with French interpretation) at OECD headquarters, 2 rue André Pascal, Paris 75016. Journalists wishing to attend are asked to register with Sara Sreberny-Mohammadi in OECD’s media division.
A Policy Brief with the main conclusions will be freely accessible in pdf format (in English and French) on the OECD’s web site at www.oecd.org/eco/surveys/euroarea. You are invited to include this internet link in reports on the survey.

Congress Urges Spending Restraint

Congress Urges Spending Restraint
Facing Largest Deficit Since 1945, Obama Names Official to Help Retool Budget

The nation's budget deficit will soar to an unprecedented $1.2 trillion this year, congressional budget analysts said yesterday, a startling tide of red ink that could dampen enthusiasm on Capitol Hill for some of President-elect Barack Obama's most ambitious priorities.
In the first official estimate of the damage done to the nation's finances by a weakening economy and various financial-sector bailouts, the Congressional Budget Office (CBO) reported that the gap between government spending and available revenue will exceed 8 percent of the overall economy by the end of September, a chasm not seen since the end of World War II.
The news drew a grim reaction from Congress, where the chairman of the Senate Budget Committee, Sen. Kent Conrad (D-N.D.), called the figure "jaw-dropping." While lawmakers said they expect to dig this year's hole even deeper by approving a massive stimulus package aimed at pulling the nation out of recession, Conrad and his House counterpart, Rep. John M. Spratt Jr. (D-S.C.), said they have warned Obama to limit the package to temporary measures that will not add to the deficit in future years.

U.S. Congressional Budget Office Articles on washingtonpost.com