Business News » Financial News

Maize prices with 14-months top

viliyana89 — Sun, 29 Aug 2010 12:30:43 +0000

The maize prices today reached a maximum 14-month global commodity exchanges, Itar-Tass. Today at 13 hours (local time) the price of corn on the Chicago Stock Exchange rose by 2% compared to late last week to 4.45 dollars per bushel (27.3 kg). The main reason are the latest projections by industry experts that provide lower crop of corn than expected in the U.S. (which is the largest producer and exporter of maize in the world) and other countries. The latest data in the regions of the U.S. Midwest growing the most corn, lately there is a shortage of moisture in the soil. Unfavorable conditions for ripening of the main forage crop can be seen in many areas of Argentina and Australia. As a result of that, experts from the World Grains Council does not exclude the possibility of maize crop in the world to be lower than estimated just a month earlier. Last week the World Grains Council revised downwards its forecast for the yield of wheat in the world. Meanwhile, demand side of corn in world markets continues to be significant, mainly due to major floods in China, where huge areas were destroyed with the main forage crop.
The increase is quite high for the strong season, but the fires in Russia and now rains in Europe supported this increase.

Lloyds announced that will leave Ireland

viliyana89 — Sat, 21 Aug 2010 12:30:14 +0000

The British banking group Lloyds Banking Group announced that it is withdrawn from the market in Ireland. As a reason for this state financial institution “concluded that the country is minimal growth opportunities,” said Wall Street Journal. The decision of Lloyds, 41% of capital owned by the British government, comes after the closure of the entire network of bank branches to Ireland. It took place in June when 44 branches across the country closed doors. Before the financial crisis, Lloyds has managed to achieve significant gains from the real estate boom in lending, but now the situation in the country is quite different. Because of the crisis leading banks in Ireland are facing huge losses, but three of the largest financial institutions were nationalized. Nationalization because investors fear that the country will need to pour more of taxpayers’ money in the banking sector, which in turn negatively impact on confidence in the stability of Ireland. In recent months, speculation about a collapse of the financial system periodically recruited force, which is reflected in strong growth in the risk premium of Ireland.
Earlier this month by Lloyds said that in the first six months of the year the bank lost 2.2 billion dollars because of bad loans on the market in Ireland. Over the past 12 months did lose around 3.5 billion dollars.

Foreigners sold US bons in June, while the Government support debt relief program

viliyana89 — Mon, 16 Aug 2010 19:14:50 +0000

In June, foreigners were among the top sellers of financial instruments in the U.S.. This resulted in a net outflow of investment, regular data show the U.S. finance ministry. Investors abroad sold a net financial instruments for 6.7 billion dollars in June. Related net sales were observed for the first time five months ago. For comparison, in May net foreign imported 17.1 billion dollars of American financial market. Positive news for U.S. monthly data is that increased purchases of long-term instruments. In June of this segment were targeted net 44.4 billion dollars, well over 35.3 billion dollars, made a month earlier. The debt relief program sponsored by the Government support small investors, to cope with the burden of their bank obligations. The banks help to consumers with free credit card consolidation, which in turn relieves the payment of obligations, saves money and reduces bad loans. Market is formed and new wave of credit card debt settlement companies, which are an alternative to bankruptcy but in a much more mild. So large companies deal with the burden of paying their loans, bringing together in larger conurbation and benefit from economies of scale, easier distribution and a wider range of customers. All these changes contribute to the development of the U.S. economy in a recessionary after awakening.
The data indicate that for the second consecutive month the foreigners were net sellers of corporate bonds.

Banks around the world are in “regulatory holiday”

viliyana89 — Mon, 02 Aug 2010 12:31:27 +0000

The bankers who spent last year lobbying against reforms in the sector can be attributed to well-deserved break. For others it will not be easy. In the upcoming month of August will be three years since the first problems appeared with the British bank Northern Rock, which after weeks triggered a liquidity crisis. A year later, does it require large U.S. banks to be bailed out by government. The time is ripe to ask what has changed since then to make the global financial system more secure in reporting greater risks and less dependent on government support. The sad answer is that changes are not enough. Last week the bank regulators have imposed new standards on capital adequacy and liquidity – those who had to identify harmonization and firmness in global financial regulations, against the backdrop of attempts by banks to avoid monitoring. Instead, the Bank for International Settlements (BIS) announced exchange earlier proposals and give the banks eight years to meet the requirements. BIS should succumb to pressure from France and Germany do not be too tight to their banks. Discouraging compromise followed European stress tests that only 7 of 91 banks have not passed because the criteria they were too low.
Consensus between the U.S. and Europe from 2008 on the need for their financial decrease of mastodons was deceptive desire. The main problem for reaching an effective solution in response to the financial crisis of 2008 was a different agenda to policy makers in different countries and across U.S. states. As a result, reforms are inconsistent and generally did very little about the decision of the two major problems that crisis call – that global banks are too big and too bound to be left to fail. The most disappointing part of the reform is how easily these banks rejected the obvious solution – to divide the investment operations of retail banking. This would help to rein in excessive risk-taking, financed with funds from deposits and government guarantees. Expressed as former head of Barclays Martin Taylor, the investment departments of banks are parasitic in nature. Volkar Paul, former chairman of the Federal Reserve (U.S. central bank), fight for inserting text into the draft financial reform in the U.S., which prohibits transactions for own account of the big banks and forced them to limit their investments in hedge funds and non-public companies. Later, however, the second requirement was softened, but banks now able to circumvent the first. BIS acknowledges in a report this week that without structural reforms, regulators must find another way to reduce the tendency of banks to become larger, more complex and burdensome for taxpayers. U.S. rely on new powers, empowering regulators to take control of problem institutions, and to divide them. Some U.S. politicians believe that this solves the problem of “too big to fail”, but it’s naive conception. Much depends on the ability of regulators to impose restrictions regarding leverage, capital and liquidity of financial institutions, such as problems for banks on Wall Street were caused not least by their high leverage. In this respect, the compromise made by the BIS, this week is a bad sign, although the future will tell.

Real test for banks will be to raise long-term financial resources

viliyana89 — Sat, 24 Jul 2010 09:26:37 +0000

Since most European banks have moved long-awaited stress tests, they now face even more serious challenge in the coming months, namely – the collection of long-term resource for billions of dollars with which to finance lending. Card is placed on the fragile economic recovery across Europe. Unlike the U.S. the majority of European companies rely on bank financing. If banks fail to attract investors to the bond markets, they will be able to grant long term loans, which businesses to fund their investments. According to the European Central Bank (ECB) bank loans accounted for 70% of debt financing to companies in the euro area, while 80% of loans to U.S. companies raised through capital markets, reported Wall Street Journal. European governments are hoping stress tests that only 7 of 91 banks failed to pass, to reduce concerns about the health of the banking sector in Europe, encouraging investors to buy bonds of credit institutions. So far, banks face problems raising funds from markets, and instead resorted to mass services of the ECB to fund their daily operations. “The real test is whether banks will be financed at a reasonable price from the capital markets to perform their usual function in the economy,” said Gary Jenkins, head of analysis of fixed income instruments at Evolution Securities.
Problems with funding reflected the changed attitude among U.S. money funds, which historically have been a stable source of funding for European banks, says Alastair Ryan, analyst at UBS. Currently, these funds have lost their risk appetite and banks shy away from the Old Continent, partly because of new regulations in the U.S.. Insurance companies, another common source of funding, are about to face higher demands for the holding of bank debt against the looming global regulation. “Overall, financial markets are likely to remain expensive and inaccessible to banks for an extended period of time,” said Ryan. Last month, Bank of England warned that credit institutions in the world (mostly those in Europe) are facing a huge challenge to refinance resource worth 5 trillion. dollars, which is expected to matures over the next three years. Problems are most acute in France, Germany and Italy, where banks annually will have to refinance more debt than they normally issued within a year. According to estimates by the International Monetary Fund (IMF) this year in the euro area mature debts 877 billion in 2011 will be 771 billion and in 2012 to 714 billion. Refinancing of maturing debt is not the only problem facing European banks. New requirements for liquidity offered by international bank regulators require banks to hold more long-term rate (stable) funding, as are deposits and emissions of long-term bonds. This, analysts said, could force banks to raise new funding for the trillions of euros. Natural source of raising funds from banks deposits, which are cheaper than bonds. Therefore, competition for deposits is increasing. This is good for making a deposit, but inflate the cost of financing in the banking sector. Some banks, like the Spanish Banco Santander, is trying to attract deposits in the UK, offering interest rates to 4% – well above competitors, experts share. Recently, some European economists lowered their forecasts for economic growth on the Old Continent this year and next because of problems with bank financing. If, however, stress tests remove pressure on banks, the economic outlook may be better than expected, “said David Mackie, an economist at JP Morgan.

Asian indexes decreased after two positive sessions

viliyana89 — Thu, 22 Jul 2010 16:12:53 +0000

The Eurozone growth is below 2% by the end of 2012 due to the efforts of many countries in the region to resolve problems with their debts. This forecast in a statement today, the International Monetary Fund (IMF), said Wall Street Journal. IMF stresses that there are three main areas that need attention in order to achieve a sustainable economic recovery: dealing with weakness in the banking sector, the implementation of ambitious plans for fiscal consolidation and continuation of fundamental structural reforms of social insurance and the labor market. After the 16 eurozone countries sharply increased their overall fiscal deficit in 2009 to counter the global recession, the IMF predicted that the euro will have a “neutral fiscal policy in 2010 and reduce its deficit over the next two years. A strict fiscal discipline will limit growth, indicated by the IMF, but at the same time it is needed to stabilize debt levels in the region. Fears of bankruptcy arising from the Greek financial crisis since the beginning of the year and motivate other highly indebted countries in the eurozone to reduce costs. “We expect that measures will be sufficient to address the debt crisis,” said a statement by the IMF. “However, in weak investor confidence and fiscal restructuring will limit potential growth.
As a result, the IMF predicted that unemployment in the euro area, which was 7.6% before the global recession in 2009 is expected to remain at 10.2 percent this year and fall only to 10.1% in 2012. Positive side, however, is the decline of the euro, which is expected to support exports. IMF states that the euro ‘is now stable. “Recovery of Europe will be facilitated further if the euro remains at these levels,” says Luke Evarart, Director of European Department of IMF. In deep risk for Europe is the return of the credit crunch. Credit meltdown of this magnitude by 2009 could cut gross domestic product (GDP) the euro area by 2% next year. IMF stressed that future growth in the region depends on the application of a number of structural reforms, but that progress in this direction is too episodic. Among the measures supported by the IMF, is raising the retirement age as a way of encouraging Europeans to work longer. Germany, said the IMF must improve competitiveness in the sector service, France would simplify procedures for the release of employees from work to accelerate the privatization Italy and Spain to reduce unemployment benefits to motivate the unemployed to seek new employment. IMF pointed out as important and need to strengthen the European institutions. “Now is the time to establish effective economic and monetary union by the strict application of healthy fiscal and structural policies, and completion of the overall framework for financial stability,” said the statement of the fund.

Bank of Japan expects lower growth in 2011

viliyana89 — Thu, 15 Jul 2010 19:54:40 +0000

The Bank of Japan (YATSB) adjusted downward its forecast for growth of the Japanese economy in 2011, after the Debt Crisis in Europe worsened outlook for the global economy. Monetary institution, and leave the base rate in the country of its record low level of 0.1 percent for the 20th consecutive month after today’s meeting in line with market expectations. Its management expects gross domestic product (GDP) to increase by 1.9 percent next fiscal year which begins on April 1, 2011 This is less than forecast in April growth of 2 percent, says Bloomberg. For this fiscal year provides YATSB GDP growth of 2.6 percent from the previous forecast of 1.8 percent. With regard to deflation, it is expected to amount to 0.4 percent for the year. The rapid economic development of Asian countries is among the most important factors for improving forecasts of the Japanese economy this year. With the depletion of the effects of fiscal incentives for governments, however, next year is expected lower economic growth. Japan’s economy grew more than expected 5% of the aligned on an annual basis in the first quarter. Compared with the last three months of 2009 it increased by 1.2 per cent. Limited bank credit deflation and persist in the country, however, led YATSB to draw another 3 trillion. yen in the banking system. In December 2009 it spent 10 trillion. yen as short-term loans to banks, the amount was doubled to 20 trillion. yen in March. The home loan comparison is giving good sign for economy recovery, but still under the expectings from the government.
The Japanese Yen more expensive by 0.3% against the dollar today, at 10:20 pm local time pair USD / JPy quoted at 88.12 yen from about one dollar.

Obama: We are going into right direction, but slowly

viliyana89 — Sun, 04 Jul 2010 22:10:54 +0000

The U.S. economy has made in the right direction but not fast enough. It said the president of the country Barack Obama after the publication of data on the labor market in June, which contributed to fears that the recovery is delayed, AFP reported. The Data of the Ministry of Labor indicated that last month the U.S. economy lost jobs for the first time since December. But Obama tried to be positive. “Our economy has created nearly 600 thousand jobs in the private sector this year,” he said. “We are headed in the right direction, but we have not made fast enough for most Americans. We have not made fast enough for me, “he said. The president promised to do everything in their jobs.
The US economy is recovering from the financial crisis and the expecting for the future economy growing is positive. It was mentioned twice from Obama, that USA will follow economy growing in each case and each price. The US government invested large value of money for developing of the key companies for the economy.
The US business started feeling this positive signs for economy recovery last months, but this is only the beginning of the hard recovery process.

Decline in new car sales in US for June

viliyana89 — Thu, 01 Jul 2010 23:01:16 +0000

The new car sales in the U.S. slowed in June, according to data producers and analysts of the sector. This increases fears that the market recovery may be delayed after months of slow but encouraging growth, forward New York Times. Sales of most manufacturers are higher than in June last year which was very bad for the sector, but are below the levels in March, April and May. Total new car sales fell by 10.8 percent in June compared to May and annual account growth of 14.4 percent. Compared to May sales fell 14 percent for Toyota, with 13 percent for GM, with 12 percent of Chrysler and 11% for Ford. Typically, sales in June decreased by about 3 per cent in May. The Annual sales of Chrysler rose by 35% of Ford – by 13% and GM – 11%. Toyota’s sales rose by 7 per cent. “People feel a little better than at the same time last year, but their financial situation really has not changed much. Until it starts to look better, they will not feel appropriate, entering showrooms, “said analyst Jessica Caldwell sector.
The result is based on the global picture of bad economy data of USA for the previous month.

Venezuela proved its plans for nationalization of crude oil industry

viliyana89 — Sun, 27 Jun 2010 10:08:10 +0000

Venezuela announced on Friday that U.S. Helmerich & Payne Inc. (H & P) is the only one of 33 oil companies operating in the country which has refused to renegotiate prices. Of the 32 companies with which the terms were renegotiated 18 are foreign and 14 – local businesses. “Although the meetings with representatives and heads of Helmerich for nearly a year because of their strong position was not possible to reach an agreement,” said a statement from state oil company Petroleos de Venezuela (PDVSA). Socialist government of President Hugo Chavez announced last week its plans for the nationalization of unused oil platforms Helmerich 11th and start extracting oil. These platforms are out of service more than a year. Helmerich stopped them because Venezuela’s PDVSA owed 43 billion dollars of work done. Since based in Tulsa, Oklahoma company said it wanted to pay them before they put them back. Helmerich also expected to resolve disputes with foreign PDVSA, some of which are related to the January devaluation of local currency – Bolivar. The foreign ministry of the United States be involved in the dispute on Friday urging the Government of Venezuela to compensate the U.S. oil companies if they decide to nationalize part of their facilities. Simply urged them to compensate the owners of oil wells if they undertake such a step, “said Marc Tounar, spokesman for the ministry. PDVSA said that “does not accept the statement made by the spokespersons of the American Empire, which once again is trying to complicate relations with our partners.”
PDVSA also announced it reached an agreement for oil services in the U.S. energy giant Schlumberger. In recent years the government of Chavez has nationalized many companies and other parts of the oil industry in an attempt to identify the “oil independence”.