The U.S. and Europe can do nothing to steer their economies from falling into recession, says New York University economist Nouriel Roubini. A look at his Twitter page shows Roubini, famous for accurately predicting the severity of the recent recession well before it happened, has abandoned all hope for avoiding double-dipping back into economic contraction. "Economy already in recession. Whatever the Fed does now is too little, too late," Roubini tweets. Forecasts are bleak even among those who believe the U.S. economy is not contracting. Blackstone Chief Operating Officer Tony James puts the odds of a double-dip recession at one in three. Even if the economy technically avoids a recession, defined as two consecutive quarters of economic contraction, weak growth will make it feel like a recession for many, he says. "One percent growth is going to feel like a recession for most of America," James tells CNBC. That means weak economic growth and high unemployment may remain the norm for years. "What has happened is that the recovery we were experiencing in 2010 has basically stalled out," Jerry Nickelsburg, senior economist at UCLA Anderson, tells the Ventura County Star. "We're moving sideways. Consumers are being more frugal, squeezed by high gasoline prices and nervous about the turmoil in the financial markets."He said today’s economy could be as good as it gets for some time. "Slow economic growth and high unemployment mean times are not going to be good for a while," Nickelsburg says. Big multilateral organizations like the World Bank are getting worried as well. "We’re getting closer to the risks of double dip," World Bank President Robert Zoellick tells Bloomberg. "I still wouldn’t predict it, but it really depends on how the risks coming out of Europe are managed."
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Three years after our first Leaders’ meeting, reverberations of the global financial crisis are still being felt by citizens and governments around the world. For many advanced economies the path out of the deep and prolonged recession will be difficult. This will impact on growth in emerging markets, and there is more limited room for manoeuvre than in 2009.
We fully support your call yesterday that the priority of the G20 must be to “help the world find the path to growth”. We will give our full backing to your Presidency in achieving this at the Cannes Summit in November. We need decisive action to support growth, confidence and credibility.
We have not yet mastered the challenges of the crisis. Global imbalances are rising again. External risks to the stability of our banks and our economies are reaching pre-crisis levels. And volatile and high energy prices are hurting our citizens and acting as a drain on world growth.
At the same time, the confidence of citizens, businesses and markets has been damaged due to the lack of visible political will: this in itself is holding back the recovery. Over the summer, the difficulties encountered in finding a durable solution to sovereign debt problems have further affected confidence.
Money-market funds are typically seen as low-risk investments and are used everywhere from individual investors' retirement accounts to the balance sheets of the world's largest financial institutions. Prime money-market funds typically invest in high-grade corporate debt, as opposed to government securities.
The funds' heavy European exposure has given investors cause for concern in recent months, as European leaders struggle to deal with sovereign debt crises and heavy debt burdens. Some fear a repeat of what happened in 2008, when the giant Reserve Primary Fund "broke the buck," or dipped below the $1 net asset value the funds seek to maintain, after Lehman Brothers Holdings Inc. filed for bankruptcy protection in 2008.
Most of the downgrade warnings on European financial institutions don't apply to short-term obligations, such as those held in money funds, yet managers continued to move away from European debt.
Money-fund managers also moved to shorten the maturities on their European holdings. As of the end of August, 28% of money-fund exposure to French certificates of deposit was in securities with maturities of seven days or fewer, according to Fitch. That's a four-fold increase compared with the end of June.
Managers continued to veer away from French banks. Some 11.2% of money-fund assets came from French institutions at the end of August, down from 14.1% the month before, a 19% decline. Exposure to banks in the U.K. decreased to 8.8% from 10.5% at the end of July.
The financial institutions with the largest exposure to money-market funds are Barclays PLC, BNP Paribas SA, Rabobank Groep NV, Deutsche Bank AG and Westpac Banking Corp., according to Fitch. None of those institutions count more than 3.8% of their total assets under management as money funds.
En España, el selectivo Ibex 35 ha pasado de avanzar un 1,5% a un 0,70% a las 09.20 y un 0,34% a las 09.35. Este tímido rebote era insuficiente para que la Bolsa española recuperara la cota psicológica de los 8.000 puntos. Mientras, el resto de parqués de referencia repuntaban entre el 0,8% de París y el0,11% de Londres al 0,50% de Fráncfort.
El sector financiero ha vuelto a acaparar hoy la atención de los inversores tras la publicación de que la UE acelerará la recapitalización de 16 bancos europeos, entre ellos siete españoles -Banco Popular, el Sabadell, Bankinter, Bankia, Banca Cívica, Novacaixagalicia y la Caixa Ontinyent-. Esta entidades son las que aprobaron más justas las pruebas de resistencia de la banca europea del pasado mes de julio. Sin embargo, los aludidos por el Comisario de Mercado Interior y Servicios, Michel Barnier, recuerdan que los exámenes fueron de una enorme dureza con España. Además, destacan que no se tuvo en cuenta el capital acumulado en las emisiones de bonos convertibles en acciones ni en las provisiones anticíclicas, según informa Íñigo de Barrón.
La necesidad de reforzar el capital de los bancos europeos ha sido objeto de un intenso debate desde que funcionarios del Fondo Monetario Internacional, (FMI), indicaron que a raíz del agravamiento de la crisis de deuda, las entidades europeas podían sufrir pérdidas de unos 200.000 millones. La necesidad de reforzar los bancos europeos fue objeto de un intenso debate por parte de los ministros en los consejos informales del Euro grupo y Ecofin celebrados el pasado fin de semana en Wroclaw.
El deterioro del mercado de deuda ha debilitado a las entidades que tienen sus balances con importantes participaciones de bonos de Grecia, Irlanda, Portugal, Italia y España. Los bancos franceses y belgas BNP Paribas, Dexia, Crédit Agricole, Société Générale, ING y KBC, acumulan más de 100.000 millones de deuda pública de estos países. Curiosamente, ninguno de ellos está entre los 16 de la lista de Barnier. Las 10 principales entidades alemanas precisarían un refuerzo de 127.000 millones de euros, según el Instituto DIW.
Precisamente, desde Grecia también llegaban noticias negativas sobre el sistema bancario. La agencia de calificación de riesgos Moody's ha rebajado hoy la nota de solvencia de ocho bancos griegos, al mismo tiempo que ha decidido mantenerlos con perspectiva negativa, por el empeoramiento de la crisis de la deuda del país helénico. Con este recorte, las entidades se hunden aún más en el nivel del bono basura.
En los mercados de divisas, el euro ha logrado mantener durante más tiempo las subidas frente al dólar, con lo que volvía a situarse sobre las 1,35 unidades del billete verde. En cuanto a la evolución de la deuda de los países bajo sospecha, el sobreprecio exigido a los bonos españoles a 10 años frente a los alemanes, la llamada prima de riesgo, prorrogaba los descensos de la víspera y se situaba sobre los 353 puntos básicos, unos ocho menos que ayer.
EU opens country’s door to international gaming companies
After dozens of complaints and years in the courts, the European Commission ruled on Tuesday that protectionary laws that prevented foreign betting services from operating legally in Denmark violate EU treaties.
The European Commission noted in its ruling that existing state gaming operators, such as Danske Spil, which runs lotto and sells scratch cards, could no longer be regarded as non-profit organisations, “given that they are subject to strict annual revenue targets and often rely on commercial retail outlets to market their various gambling services”.
Le ministre grec des finances Evangelos Venizelos a évoqué devant le parlement trois scénarios pour résoudre la crise budgétaire, dont celui d'un défaut ordonné avec une décote de 50% pour les détenteurs de dette souveraine, rapporte vendredi la presse grecque.
Un porte-parole du gouvernement grec a démenti les informations des journaux Ethnos et Ta Nea, qui précisent que les deux autres scénarios sont soit un défaut désordonné, soit la mise en oeuvre du deuxième plan de sauvetage de 109 milliards d'euros convenu le 21 juillet dernier.
Citant des témoins d'un discours donné par Evangelos Venizelos, Ta Nea rapporte que le ministre grec des Finances aurait en outre jugé "très dangereux" pour Athènes de demander une décote de 50%. "Ceci exigerait un large effort coordonné", aurait-il ajouté. Une porte-parole du ministère des Finances a dit ne pas être en mesure de commenter les articles, mais un des porte-parole du gouvernement grec, Angelos Tolkas, les a démentis.
"Ce que nous choisissons (pour la Grèce) c'est de rester au coeur de l'Europe avec la mise en oeuvre des décisions du 21 juillet. Le gros défi est d'éviter tout défaut ou effondrement." La député socialiste Theodora Tzakri, qui dit avoir écouté le discours d'Evangelos Venizelos cité par la presse, a également démenti que ce dernier avait évoqué le scénario d'une décote de 50%.
The Greek Finance Minister Evangelos Venizelos spoke to parliament three scenarios to solve the budget crisis, including a default ordered at a discount of 50% for holders of sovereign debt, the Greek press reported Friday.
A spokesman for the Greek government has denied reports the newspaper Ta Nea and Ethnos, which state that the other two scenarios are disordered or defective, or the implementation of the second rescue plan 109 billion euros agreed on 21 July.
Citing witness a speech given by Evangelos Venizelos, Ta Nea reported that the Greek Finance Minister would also have considered "very dangerous" for Athens to claim a discount of 50%. "This would require a large coordinated effort," would have said. A spokesman for the Ministry of Finance said not to be able to comment on articles, but a spokesman for the Greek government, Angelos Tolk, has denied.
"What we choose (for Greece) is to stay in the heart of Europe with the implementation of the decisions of July 21. The big challenge is to avoid failure or collapse." The Socialist deputy Tzakri Theodora, who says he listened to the speech of Evangelos Venizelos cited by the press, also denied that he had discussed the scenario with a discount of 50%.
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