Ten US banks fail recession test

May 8 2009

US banks would need a total of £50 billion in additional funds to survive if the recession deepens, the results of government "stress tests" showed.

An assessment of the robustness of the sector found that 10 of the 19 largest banks would need to find extra capital to see them through the bad times.

Bank of America faces the largest potential shortfall of £23 billion.

It joined a list of institutions that also includes Citigroup and Wells Fargo.

The stress tests were designed to gauge whether America's 19 largest banks have enough capital to see them through a deepening of the recession.

After Bank of America, Wells Fargo was found to have the second largest shortfall of £9.1 billion, followed by GMAC with a potential £7.6 billion black hole.

Ten US banks fail recession test

May 8 2009

US banks would need a total of £50 billion in additional funds to survive if the recession deepens, the results of government "stress tests" showed.

An assessment of the robustness of the sector found that 10 of the 19 largest banks would need to find extra capital to see them through the bad times.

Bank of America faces the largest potential shortfall of £23 billion.

It joined a list of institutions that also includes Citigroup and Wells Fargo.

The stress tests were designed to gauge whether America's 19 largest banks have enough capital to see them through a deepening of the recession.

After Bank of America, Wells Fargo was found to have the second largest shortfall of £9.1 billion, followed by GMAC with a potential £7.6 billion black hole.

Citigroup is being asked to raise an additional £3.3 billion to make it secure. Goldman Sachs, JP Morgan Chase and American Express were among the nine banks deemed not to need to raise additional funds.

The stress tests were designed to help regulators assess the ongoing financial stability of US banks.

They look at two models of the economy going forward - one in which unemployment reaches 8.8% next year and house prices drop a further 14%. In the second scenario, joblessness rises to 10.3% and property slips another 22%.

Banks facing a shortfall under the model will have to come up with a plan to raise additional capital by mid June.

 If they cannot do so independently, they may have to turn to the government's £466 billion financial bailout fund.

sourced from Runcorn and Widnes Weekly News

Indicators of economic depression ending-- Google searches vs. job losses

read the full article at examiner.com

Larry Summers, Obama's top economic advisor has summed up the state of the economy today in what Forbes online is calling "promising", but somewhat "obscure" signs of recovery.

 

The Job Impact of the American Recovery and Reinvestment Plan

• "Earlier this year traders were betting there was a one-in-six chance that the Dow would fall below 5,000, he said. Now they say it's one-in-a-hundred.


• The chances that corporate bonds will default has fallen by a third.


• And Google searches for 'economic depression,' which surged to quadruple their normal levels, have since returned to normal. (A growing number of economists do believe that the recession has ended or will end in coming months.)"

read the full article at  examiner.com

Indicators of economic depression ending-- Google searches vs. job losses

read the full article at examiner.com

Larry Summers, Obama's top economic advisor has summed up the state of the economy today in what Forbes online is calling "promising", but somewhat "obscure" signs of recovery.

 

The Job Impact of the American Recovery and Reinvestment Plan

• "Earlier this year traders were betting there was a one-in-six chance that the Dow would fall below 5,000, he said. Now they say it's one-in-a-hundred.


• The chances that corporate bonds will default has fallen by a third.


• And Google searches for 'economic depression,' which surged to quadruple their normal levels, have since returned to normal. (A growing number of economists do believe that the recession has ended or will end in coming months.)"

read the full article at  examiner.com

A poor advert for advertising standards?

Link to BBC article

A poster showing a nervous man alongside the slogan "Take Courage my friend" has been banned by the Advertising Standards Authority (ASA) for suggesting the beer could boost confidence.

Newsnight's culture correspondent Stephen Smith reports.

A poor advert for advertising standards?

Link to BBC article

A poster showing a nervous man alongside the slogan "Take Courage my friend" has been banned by the Advertising Standards Authority (ASA) for suggesting the beer could boost confidence.

Newsnight's culture correspondent Stephen Smith reports.

New Capitalism

Robert Peston has done a couple of short videos - relating to the current economic situation.

Part One [Broadcast Thursday December 18th]:

Watch here

Part Two [Broadcast Friday December 19th]:

Watch here

sourced from The BBC

British jobs for British workers

Deal hope in foreign workers row

Workers say the action is not racist, but about discrimination against Britons

A possible deal to end the row over the use of foreign labour at Lincolnshire's Lindsey Oil Refinery will be put to local union leaders and workers later.

The proposal emerged after talks chaired by Acas.

A GMB union source told the BBC the deal could see half of the disputed 200 jobs offered to British workers, but the Unite leader has denied this.

Hope that new 'half-and-half' deal in foreign workers row could end wildcat strikes

A proposed deal that could end the bitter row over foreign workers at an oil refinery will be put to unions today.

Marathon talks aimed at ending a series of wildcat strikes at Lindsey plant in Lincolnshire ended last night with the outline of a possible deal.

Union sources said it involved offering half the jobs of the disputed recruitment contract to UK workers.

Downturn will bring big fall in migrant workers, says CBI

Companies facing decline in demand for goods and services will reduce their use of agency staff, MPs are told

The use of migrant labour in Britain will decline abruptly as companies face a sharp fall in demand for their goods and services, the Confederation of British Industry told MPs yesterday. John Cridland, the CBI's deputy director general, told the Commons home affairs committee that the first response of many firms to the downturn was to reduce their dependency on agency staff, many of whom are migrant workers.

He said that there was evidence that many nationals of new EU states were going home as unemployment rose in Britain and suggested that the flow of skilled migrants from outside Europe would also decline. He added: "I expect that, when we have the next report from the [Home Office's] migration advisory committee on the needs for skilled labour, we will not see the same need for non-EU labour in the same numbers because of the need to provide as many employment opportunities as possible for the unemployed. All I'm suggesting is that the market will correct itself, but what we cannot avoid is a significant increase in unemployment, which is a sad but inevitable consequence of recession."

read full articles Click here

British jobs for British workers

Deal hope in foreign workers row

Workers say the action is not racist, but about discrimination against Britons

A possible deal to end the row over the use of foreign labour at Lincolnshire's Lindsey Oil Refinery will be put to local union leaders and workers later.

The proposal emerged after talks chaired by Acas.

A GMB union source told the BBC the deal could see half of the disputed 200 jobs offered to British workers, but the Unite leader has denied this.

Hope that new 'half-and-half' deal in foreign workers row could end wildcat strikes

A proposed deal that could end the bitter row over foreign workers at an oil refinery will be put to unions today.

Marathon talks aimed at ending a series of wildcat strikes at Lindsey plant in Lincolnshire ended last night with the outline of a possible deal.

Union sources said it involved offering half the jobs of the disputed recruitment contract to UK workers.

Downturn will bring big fall in migrant workers, says CBI

Companies facing decline in demand for goods and services will reduce their use of agency staff, MPs are told

The use of migrant labour in Britain will decline abruptly as companies face a sharp fall in demand for their goods and services, the Confederation of British Industry told MPs yesterday. John Cridland, the CBI's deputy director general, told the Commons home affairs committee that the first response of many firms to the downturn was to reduce their dependency on agency staff, many of whom are migrant workers.

He said that there was evidence that many nationals of new EU states were going home as unemployment rose in Britain and suggested that the flow of skilled migrants from outside Europe would also decline. He added: "I expect that, when we have the next report from the [Home Office's] migration advisory committee on the needs for skilled labour, we will not see the same need for non-EU labour in the same numbers because of the need to provide as many employment opportunities as possible for the unemployed. All I'm suggesting is that the market will correct itself, but what we cannot avoid is a significant increase in unemployment, which is a sad but inevitable consequence of recession."

read full articles Click here

McDonalds to open 1,000 stores this year

[polldaddy poll="1314875"]

McDonald's to open 1,000 stores

McDonald's US sales were up 5% on the year before US fast-food chain McDonald's says it plans to open 1,000 new restaurants this year. The world's largest hamburger chain also said fourth-quarter net income fell 23% to $985.3m (£710m), from $1.27bn a year before. Revenue fell to $5.57bn from $5.75bn, even though global same-store sales rose 7.2%, as the firm was hit by the strong dollar. In the US, the firm raised the price of its Double Cheeseburger in November. Announcing the results, chief executive Jim Skinner said: "For 2009 we plan to invest $2.1bn in capital to open about 1,000 new restaurants and reinvest in our existing locations." Despite beef, cheese, and other ingredients rising in price, the company reported an 8% fall in total operating costs and expenses. McDonald's has seen sales rise in the economic downturn, helped by its low prices and ubiquity of its outlets. In the quarter, its same-store sales in the US rose 5% on the year before. International same-store sales were also ahead, rising 7.6% in Europe and 10% in the Asia-Pacific, Middle East and Africa division. sourced from The BBC

McDonald's to open 1,000 new stores

Despite falling short of Wall Street expectations, the burger chain experiences better-than-expected profit and will open 1,000 new restaurants.

NEW YORK (Reuters) -- McDonald's Corp. reported a better-than-expected quarterly profit on Monday though revenue fell short of Wall Street expectations due to a stronger U.S. dollar, and its shares fell more than 2%.

The world's largest hamburger chain also said it would open 1,000 restaurants this year.

Fourth-quarter net income fell about 23% to $985.3 million, or 87 cents per share, from $1.27 billion, or $1.06 per share, a year earlier, when results included a large tax-related benefit.

Analysts on average were expecting earnings of 83 cents per share, according to Reuters Estimates.

sourced from CCN Money read full article

McDonalds to open 1,000 stores this year

[polldaddy poll="1314875"]

McDonald's to open 1,000 stores

McDonald's US sales were up 5% on the year before US fast-food chain McDonald's says it plans to open 1,000 new restaurants this year. The world's largest hamburger chain also said fourth-quarter net income fell 23% to $985.3m (£710m), from $1.27bn a year before. Revenue fell to $5.57bn from $5.75bn, even though global same-store sales rose 7.2%, as the firm was hit by the strong dollar. In the US, the firm raised the price of its Double Cheeseburger in November. Announcing the results, chief executive Jim Skinner said: "For 2009 we plan to invest $2.1bn in capital to open about 1,000 new restaurants and reinvest in our existing locations." Despite beef, cheese, and other ingredients rising in price, the company reported an 8% fall in total operating costs and expenses. McDonald's has seen sales rise in the economic downturn, helped by its low prices and ubiquity of its outlets. In the quarter, its same-store sales in the US rose 5% on the year before. International same-store sales were also ahead, rising 7.6% in Europe and 10% in the Asia-Pacific, Middle East and Africa division. sourced from The BBC

McDonald's to open 1,000 new stores

Despite falling short of Wall Street expectations, the burger chain experiences better-than-expected profit and will open 1,000 new restaurants.

NEW YORK (Reuters) -- McDonald's Corp. reported a better-than-expected quarterly profit on Monday though revenue fell short of Wall Street expectations due to a stronger U.S. dollar, and its shares fell more than 2%.

The world's largest hamburger chain also said it would open 1,000 restaurants this year.

Fourth-quarter net income fell about 23% to $985.3 million, or 87 cents per share, from $1.27 billion, or $1.06 per share, a year earlier, when results included a large tax-related benefit.

Analysts on average were expecting earnings of 83 cents per share, according to Reuters Estimates.

sourced from CCN Money read full article

Downturn in the USA

Retail sales fell in December by 2.7 percent, a worse-than-expected number that shows how rising unemployment, stagnant wages and an ongoing housing crisis have undermined one of the basic props of the U.S. economy.

Consumer spending accounts for about two-thirds of U.S. economic activity but has headed down every month since June -- the longest period of decline since the current method of reporting the statistic was adopted in the early 1990s.

U.S. stock indexes dropped on the news, with the Dow Jones industrial average and other major exchanges losing about 1.5 percent in the opening minutes of trading. Losses had reached roughly 3 percent before noon.

read full article sourced from The Washington Post

Downturn in the USA

Retail sales fell in December by 2.7 percent, a worse-than-expected number that shows how rising unemployment, stagnant wages and an ongoing housing crisis have undermined one of the basic props of the U.S. economy.

Consumer spending accounts for about two-thirds of U.S. economic activity but has headed down every month since June -- the longest period of decline since the current method of reporting the statistic was adopted in the early 1990s.

U.S. stock indexes dropped on the news, with the Dow Jones industrial average and other major exchanges losing about 1.5 percent in the opening minutes of trading. Losses had reached roughly 3 percent before noon.

read full article sourced from The Washington Post

HMV to snap up some Zavvi stores

Entertainment retailer HMV has said it is to buy 14 stores from troubled chain Zavvi, funded by selling new shares.

Proceeds will also be used to fund a move into the live music market, taking a joint stake in a firm running 11 venues such as Hammersmith Apollo.

It will also get naming rights to some of the venues.

HMV also said that sales in the five weeks to 3 January - which includes the Christmas period - were up by 2.9%, or by 0.5% not including new stores.

Rebranding

The Zavvi stores it is buying are all profitable, HMV said, primarily in locations where it does not currently have a store.

It expects the cost of the purchase to be about £2m - including fitting out and rebranding the stores. Nine of them are in the UK and five in the Irish Republic.

read full article at The BBC

HMV to snap up some Zavvi stores

Entertainment retailer HMV has said it is to buy 14 stores from troubled chain Zavvi, funded by selling new shares.

Proceeds will also be used to fund a move into the live music market, taking a joint stake in a firm running 11 venues such as Hammersmith Apollo.

It will also get naming rights to some of the venues.

HMV also said that sales in the five weeks to 3 January - which includes the Christmas period - were up by 2.9%, or by 0.5% not including new stores.

Rebranding

The Zavvi stores it is buying are all profitable, HMV said, primarily in locations where it does not currently have a store.

It expects the cost of the purchase to be about £2m - including fitting out and rebranding the stores. Nine of them are in the UK and five in the Irish Republic.

read full article at The BBC

Land of Leather latest UK retail collapse

LONDON -- Sofa retailer Land of Leather filed for bankruptcy protection on Monday, becoming the latest British retailer to succumb to a downturn in consumer spending amid the global economic slowdown.

Land of Leather, which operates 109 retail stores across Britain and Ireland, entered the administration process _ where a company is run independently with the priority of returning funds to creditors _ after failing to raise working capital or find a buyer.

Lee Manning, one of the appointed administrators at Deloitte said that the company's stores would continue to trade as normal "while the administrators continue to talk to interested parties with a view to concluding a sale of the business as a going concern."

Land of Leather said it had found itself in challenging market conditions "for some time" as a result of the credit crunch and a lack of household spending on big ticket retail items. sourced from The Washington Post read more

My comment

This is the first of these kind of shops to go, I think we will be seeing a lot more interior / furniture / house hold accessories - Now we have all bought cushions, rugs, lampshades and kitchen's, all these shops that have opened up on the strength of the ideal home / interior design period will all start suffering. Lets all start being individual, make cushions from old materials or clothes rather then buying new ones. Thing more creatively around our homes and their interiors.

Land of Leather latest UK retail collapse

LONDON -- Sofa retailer Land of Leather filed for bankruptcy protection on Monday, becoming the latest British retailer to succumb to a downturn in consumer spending amid the global economic slowdown.

Land of Leather, which operates 109 retail stores across Britain and Ireland, entered the administration process _ where a company is run independently with the priority of returning funds to creditors _ after failing to raise working capital or find a buyer.

Lee Manning, one of the appointed administrators at Deloitte said that the company's stores would continue to trade as normal "while the administrators continue to talk to interested parties with a view to concluding a sale of the business as a going concern."

Land of Leather said it had found itself in challenging market conditions "for some time" as a result of the credit crunch and a lack of household spending on big ticket retail items. sourced from The Washington Post read more

My comment

This is the first of these kind of shops to go, I think we will be seeing a lot more interior / furniture / house hold accessories - Now we have all bought cushions, rugs, lampshades and kitchen's, all these shops that have opened up on the strength of the ideal home / interior design period will all start suffering. Lets all start being individual, make cushions from old materials or clothes rather then buying new ones. Thing more creatively around our homes and their interiors.

Q&A: What is a recession?

The dreaded R-word - recession - is in the air as every day seems to bring more gloomy economic news.

Many commentators are now openly talking about the current slowdown turning into a recession.

But how do economists define a recession and when will we know if the UK is going through one?

What is the definition of a recession?

This is a thorny question on which experts still disagree.

However, technically speaking, the UK economy would slide into recession when it experiences two successive quarters of what is known as "negative growth".

For this to happen, the total amount of goods and services produced by the UK - known as gross domestic product (GDP) - would have to contract on a quarter by quarter basis for a total period of six months.

read full article at The BBC

Q&A: What is a recession?

The dreaded R-word - recession - is in the air as every day seems to bring more gloomy economic news.

Many commentators are now openly talking about the current slowdown turning into a recession.

But how do economists define a recession and when will we know if the UK is going through one?

What is the definition of a recession?

This is a thorny question on which experts still disagree.

However, technically speaking, the UK economy would slide into recession when it experiences two successive quarters of what is known as "negative growth".

For this to happen, the total amount of goods and services produced by the UK - known as gross domestic product (GDP) - would have to contract on a quarter by quarter basis for a total period of six months.

read full article at The BBC

Is all the high street for sale

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