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ASIAN MARKETS GAIN AFTER US HOUSE PASSES STIMULUS BILL; EUROPE OPENS DOWN

Posted by Gilmour Poincaree on January 29, 2009

January 29, 2009 – 3:45 AM

by Stephen Wright – Associated Press

PUBLISHED BY ‘THE STAR TRIBUNE’ (USA)

BANGKOK, Thailand – Asian markets advanced Thursday, with Hong Kong jumping 4.6 percent in a catch-up rally, as the U.S. House of Representatives approved a $819 billion stimulus bill that investors hope will help lift the American economy out of its worst crisis in decades. European markets opened lower.

Japan’s Nikkei 225 stock average rose 144.95 points, or 1.8 percent, to 8,251.24 even as new data showed that retail sales in the world’s second-largest economy sank the most in nearly four years in December.

Hong Kong’s Hang Seng leaped 575.83 points, or 4.6 percent, to 13,154.43 after being closed for three days for the Lunar New Year. Mainland China’s markets are closed all week. South Korea’s Kospi gained 0.7 percent and Australia’s main index rose 0.9 percent.

Sentiment in Asia got a boost as President Barack Obama’s massive stimulus package moved closer to becoming a reality.

The Democratic-controlled House of Representatives approved the bill Wednesday night, sending it to the Senate where debate could begin as early as Monday. Democratic leaders have pledged to have legislation ready for Obama’s signature by mid-February.

“The U.S. stimulus package has a positive psychological impact on markets globally,” said Castor Pang, an analyst at Sun Hung Kai Financial in Hong Kong.

“But there is still going to be bad news in the form of profit warnings and unemployment,” he said. “The unemployment rate is going to continue to climb, making U.S. consumers even more hesitant about spending.”

As trading got underway in Europe, major bourses fell with France’s CAC-40 off 1.1 percent, Germany’s DAX down 1 percent and Britain’s FTSE 100 slipping 1.1 percent.

U.S. stock index futures were down, suggesting Wall Street would open lower Thursday. Dow futures were down 87 points, or 1.1 percent, at 8,235 and S&P500 futures were off 8.6 points, or 1 perc(AP) — ent, at 862.90.

Financial stocks led Asia’s advance Thursday, buoyed in part by hopes of new U.S. efforts to trim bad debt and spur lending.

In Hong Kong, banking giant HSBC jumped 8.4 percent and China’s top lender, Industrial & Commercial Bank of China Ltd., or ICBC, added 5 percent.

In Tokyo, megabank Sumitomo Mitsui Financial Group soared 13 percent, Mitsubishi UFJ jumped 4.8 percent and Mizuho added 5.2 percent.

Japanese exporters such as Sony and Toshiba reported weak quarterly results after the market closed.

Sony Corp.’s net profit tumbled 95 percent in the October-December quarter, as the global slump hurt sales of its core electronics products, while Toshiba Corp. sank into the red in the third quarter and expects a loss for the full year.

Elsewhere, New Zealand’s benchmark index was up 0.8 percent after the central bank slashed its key interest rate by 1.5 percentage points to 3.5 percent to prevent the country’s recession from deepening.

Oil prices slipped below $42 a barrel as rising U.S. crude inventories offset expectations the U.S. stimulus package will revive growth and consumer demand. Light, sweet crude for March delivery was down 34 cents to $41.82 a barrel by midday in Singapore in electronic trading on the New York Mercantile Exchange.

In currency trading, the dollar fell to 90.02 yen from 90.41 late Wednesday in New York, while the euro declined to $1.3044 from $1.3139.

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PUBLISHED BY ‘THE STAR TRIBUNE’ (USA)

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Posted in AGRICULTURE, ASIA, BANKING SYSTEMS, BARACK HUSSEIN OBAMA -(DEC. 2008/JAN. 2009), CHINA, COMMERCE, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, EUROPE, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, GERMANY, HONG KONG, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, JAPAN, RECESSION, RESTRUCTURING OF PRIVATE COMPANIES, RESTRUCTURING OF THE PUBLIC SECTOR, STOCK MARKETS, THE EUROPEAN UNION, THE FLOW OF INVESTMENTS, THE PRESIDENCY - USA, THE WORK MARKET, UNEMPLOYMENT, UNITED KINGDOM, USA | Leave a Comment »

BMW VOWS NO COMPULSORY JOB CUTS IN 2009 (Germany)

Posted by Gilmour Poincaree on January 26, 2009

10:30:00 01/26/2009

Agence France-Presse

PUBLISHED BY ‘THE PHILIPPINE DAILY INQUIRER’

BMW VOWS NO COMPULSORY JOB CUTS IN 2009 (Germany)

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PUBLISHED BY ‘THE PHILIPPINE DAILY INQUIRER’

Posted in AUTOMOTIVE INDUSTRY, COMMERCE, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, EMPLOYMENT, FINANCIAL CRISIS 2008/2009, GERMANY, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, RECESSION, RESTRUCTURING OF PRIVATE COMPANIES, THE FLOW OF INVESTMENTS, THE WORK MARKET | Leave a Comment »

BMW TO REDUCE HOURS FOR 26,000 GERMAN WORKERS TO SLOW PRODUCTION AMID ECONOMIC DOWNTURN

Posted by Gilmour Poincaree on January 20, 2009

6:44 AM EST, January 20, 2009

by George Frey – Associated Press Business Writer

PUBLISHED BY ‘NEWSDAY’ (USA)

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PUBLISHED BY ‘NEWSDAY’ (USA)

Posted in AUTOMOTIVE INDUSTRY, BANKING SYSTEMS, COMMERCE, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, EMPLOYMENT, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FOREIGN WORK FORCE - LEGAL, GERMANY, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, NATIONAL WORK FORCES, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, RESTRUCTURING OF PRIVATE COMPANIES, THE FLOW OF INVESTMENTS, THE WORK MARKET, THE WORKERS | Leave a Comment »

MOMENTUM AND CONFIDENCE IS CRITICAL

Posted by Gilmour Poincaree on January 19, 2009

4:00AM Monday Jan 19, 2009

by Mike Moore

PUBLISHED BY ‘THE NEW ZEALAND HERALD’

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PUBLISHED BY ‘THE NEW ZEALAND HERALD’

Posted in 'DOHA TALKS', AGRICULTURE, BANKING SYSTEMS, CHINA, COMMERCE, COMMERCIAL PROTECTIONISM, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, FARMING SUBSIDIES, FINANCIAL CRISIS 2008/2009, FOOD PRODUCTION (human), FOREIGN POLICIES, G20, GERMANY, INTERNATIONAL, INTERNATIONAL RELATIONS, JAPAN, NEW ZEALAND, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, THE FLOW OF INVESTMENTS, UNITED KINGDOM, USA, WORLD TRADE ORGANIZATION | Leave a Comment »

GERMANY

Posted by Gilmour Poincaree on January 19, 2009

Sunday, January 18, 2009

The International News

PUBLISHED BY ‘THE INTERNATIONAL NEWS’ (Pakistan)

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PUBLISHED BY ‘THE INTERNATIONAL NEWS’ (Pakistan)

Posted in BANKING SYSTEMS, COMMERCE, COMMODITIES MARKET, DEUTSCHMARK (Germany), ECONOMIC CONJUNCTURE, ECONOMY, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, GERMANY, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, MACROECONOMY, PUBLIC SECTOR AND STATE OWNED ENTERPRISES, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, STATE TARIFFS, THE FLOW OF INVESTMENTS, THE WORK MARKET | Leave a Comment »

LUFTHANSA, AMEX AND INDIATIMES SHOPPING IN STRATEGIC ALLIANCE (India)

Posted by Gilmour Poincaree on January 16, 2009

16 Jan 2009, 1705 hrs IST

ECONOMICTIMES.COM

PUBLISHED BY ‘THE ECONOMIC TIMES’ (India)

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PUBLISHED BY ‘THE ECONOMIC TIMES’ (India)

Posted in BANKING SYSTEM - USA, BANKING SYSTEMS, COMMERCE, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FINANCIAL SERVICES INDUSTRIES, GERMANY, INDIA, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, RECESSION, THE FLOW OF INVESTMENTS, USA | Leave a Comment »

GERMANY PUSHES BOLDER RESCUE PLAN

Posted by Gilmour Poincaree on January 15, 2009

13:33 GMT, Wednesday, 14 January 2009

by Yvonne Murray – BBC News, Berlin

PUBLISHED BY ‘BBC NEWS’ (UK)

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PUBLISHED BY ‘BBC NEWS’ (UK)

Posted in BANKING SYSTEMS, CENTRAL BANKS, COMMERCE, ECONOMIC CONJUNCTURE, ECONOMY, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, GERMANY, INDUSTRIAL PRODUCTION, INDUSTRIES, MACROECONOMY, PUBLIC SECTOR AND STATE OWNED ENTERPRISES, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, RESTRUCTURING OF PRIVATE COMPANIES, RESTRUCTURING OF THE PUBLIC SECTOR, STATE TARIFFS, THE FLOW OF INVESTMENTS | Leave a Comment »

VOLKSWAGEN SETS SALES RECORD IN 2008, DESPITE DOWNTURN – GERMAN AUTOMAKER VOLKSWAGEN SET A SALES RECORD IN 2008 AND EXPANDED ITS MARKET SHARE IN KEY MARKETS THE UNITED STATES AND GERMANY DESPITE A GLOBAL ECONOMIC CRISIS

Posted by Gilmour Poincaree on January 13, 2009

January 12, 2009

From correspondents in Detroit – Agence France-Presse

PUBLISHED BY ‘THE AUSTRALIAN’

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PUBLISHED BY ‘THE AUSTRALIAN’

Posted in AUTOMOTIVE INDUSTRY, BRASIL, CHINA, COMMERCE, COMMODITIES MARKET, ECONOMIA - BRASIL, ECONOMIC CONJUNCTURE, ECONOMY, EXPANSÃO ECONÔMICA, EXPANSÃO INDUSTRIAL, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FLUXO DE CAPITAIS, GERMANY, INDÚSTRIA AUTOMOTIVA, INDÚSTRIAS, INDUSTRIAL PRODUCTION, INDUSTRIAL PRODUCTION - USA, INDUSTRIES, INDUSTRIES - USA, INTERNATIONAL, RECESSION, STOCK MARKETS, THE FLOW OF INVESTMENTS, USA | Leave a Comment »

MERKEL MAKES £44BN U-TURN TO TRY TO SAVE SINKING GERMAN ECONOMY – CRITIC OF UK’S ‘CRASS KEYNESIANISM’ OFFERS PACKAGE OF TAX CUTS AND STATE SPENDING

Posted by Gilmour Poincaree on January 12, 2009

Sunday, 11 January 2009

by Tony Paterson in Berlin

PUBLISHED BY ‘THE INDEPENDENT’ (UK)

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PUBLISHED BY ‘THE INDEPENDENT’ (UK)

Posted in BANKING SYSTEMS, CENTRAL BANKS, COMMERCE, COMMODITIES MARKET, DEUTSCHMARK (Germany), ECONOMIC CONJUNCTURE, ECONOMY, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FINANCIAL SERVICES INDUSTRIES, GERMANY, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, PUBLIC SECTOR AND STATE OWNED ENTERPRISES, RECESSION, STATE TARIFFS, THE FLOW OF INVESTMENTS | Leave a Comment »

ANTI-SEMITIC THREATS UP IN GERMANY AND SWITZERLAND

Posted by Gilmour Poincaree on January 9, 2009

Jan 7, 2009 23:14

by Benjamin Weinthal – Post Correspondent in Berlin

PUBLISHED BY ‘THE JERUSALEM POST’ (Israel)

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PUBLISHED BY ‘THE JERUSALEM POST’ (Israel)

Posted in BANKING SYSTEM - USA, BANKRUPTCIES - USA, COMMERCE, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, FOREIGN POLICIES, FOREIGN POLICIES - USA, GERMANY, HOUSING CRISIS - USA, HUMAN RIGHTS, INDUSTRIAL PRODUCTION, INDUSTRIAL PRODUCTION - USA, INDUSTRIES, INDUSTRIES - USA, INTERNATIONAL, INTERNATIONAL RELATIONS, ISRAEL, MILITARY CONTRACTS, PALESTINE, RECESSION, SWITZERLAND, THE ARMS INDUSTRY, THE FLOW OF INVESTMENTS, THE ISRAELI-PALESTINIAN STRUGGLE, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, THE UNITED NATIONS, USA, WARS AND ARMED CONFLICTS, WEAPONS | 5 Comments »

COMMERZBANK TO GET US$13 BILLION FROM GERMAN GOVERNMENT FUND

Posted by Gilmour Poincaree on January 9, 2009

1/8/2009 9:47:00 AM

The Canadian Press

PUBLISHED BY ‘STOCKHOUSE’ (canada)

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PUBLISHED BY ‘STOCKHOUSE’ (canada)

Posted in BANKING SYSTEMS, COMMERCE, COMMODITIES MARKET, CRIMINAL ACTIVITIES, ECONOMIC CONJUNCTURE, ECONOMY, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FINANCIAL SCAMS, FINANCIAL SERVICES INDUSTRIES, GERMANY, INTERNATIONAL, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, RESTRUCTURING OF PRIVATE COMPANIES, STATE TARIFFS, STOCK MARKETS, THE FLOW OF INVESTMENTS | Leave a Comment »

GERMAN BILLIONAIRE KILLS HIMSELF AFTER MAJOR LOSSES ON VW

Posted by Gilmour Poincaree on January 7, 2009

January 6, 2009

by Carter Dougherty

PUBLISHED BY ‘THE INTERNATIONAL HERALD TRIBUNE’ (USA)

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PUBLISHED BY ‘THE INTERNATIONAL HERALD TRIBUNE’ (USA)

Posted in AUTOMOTIVE INDUSTRY, ECONOMIC CONJUNCTURE, ECONOMY, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, GERMANY, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY | Leave a Comment »

PORSCHE ACQUIRES CONTROL OF VOLKSWAGEN – THE GERMAN LUXURY SPORTS CAR MAKER PORSCHE HAS TAKEN OVER VOLKSWAGEN, THE BIGGEST EUROPEAN CAR MANUFACTURER, AFTER PURCHASING MORE THAN 50 PERCENT OF VW SHARES, PORSCHE SAID LATE ON MONDAY

Posted by Gilmour Poincaree on January 7, 2009

Tuesday, 06 Jan, 2009 – 03:15 PM PST

by our correspondent

PUBLISHED BY ‘DAWN’ (Pakistan)

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PUBLISHED BY ‘DAWN’ (Pakistan)

Posted in AUTOMOTIVE INDUSTRY, BANKING SYSTEMS, COMMERCE, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FINANCIAL SERVICES INDUSTRIES, GERMANY, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, RECESSION, RESTRUCTURING OF PRIVATE COMPANIES, STOCK MARKETS, THE FLOW OF INVESTMENTS | Leave a Comment »

SUZLON ACQUIRES FIRST TRANCHE OF MARTIFER’S STAKE IN REPOWER (India)

Posted by Gilmour Poincaree on December 31, 2008

30 Dec, 2008, 13:31 hrs IST

ET Bureau

PUBLISHED BY ‘THE ECONOMIC TIMES’ (India)

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PUBLISHED BY ‘THE ECONOMIC TIMES’ (India)

Posted in AEOLIC, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, ENERGY, ENERGY INDUSTRIES, ENVIRONMENT, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FOREIGN POLICIES, GERMANY, INDIA, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, INTERNATIONAL RELATIONS, PORTUGAL, STAGFLATION, STOCK MARKETS, THE FLOW OF INVESTMENTS | Leave a Comment »

SCIENCE JOURNAL (from the Max Planck Institute) MISTAKENLY USES FLYER FOR MACAU BROTHEL TO ILLUSTRATE REPORT ON CHINA – CHINESE ‘CLASSICAL POEM’ WAS BROTHEL AD

Posted by Gilmour Poincaree on December 29, 2008

Tuesday, 9 December 2008

by Clifford Coonan in Beijing

PUBLISHED BY ‘THE INDEPENDENT’ (UK)

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PUBLISHED BY ‘THE INDEPENDENT’ (UK)

Posted in CHINA, COMMUNICATION INDUSTRIES, ECONOMIC CONJUNCTURE, ECONOMY, EDUCATION, FINANCIAL CRISIS 2008/2009, FOREIGN POLICIES, GERMANY, INDUSTRIES, INTERNATIONAL, INTERNATIONAL RELATIONS, LITERATURE, PUBLIC SECTOR AND STATE OWNED ENTERPRISES, RECESSION, THE MEDIA (US AND FOREIGN) | Leave a Comment »

EURO CURRENCY TURNS 10; SEEN FULFILLING PROMISE – TEN YEARS AGO, EUROPE LAUNCHED ITS GRAND EXPERIMENT WITH A SHARED CURRENCY – AND WATCHED IT PLUNGE IN VALUE BEFORE RECOVERING

Posted by Gilmour Poincaree on December 28, 2008

Sunday, December 28, 2008 at 11:35 AM

by Matt Moore and George Frey – Associated Press Business Writers

PUBLISHED BY ‘THE SEATTLE TIMES’ (USA)

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PUBLISHED BY ‘THE SEATTLE TIMES’ (USA)

Posted in AUSTRIA, BANKING SYSTEMS, BELGIUM, CENTRAL BANKS, COMMERCE, CURRENCIES, CYPRUS, ECONOMIC CONJUNCTURE, ECONOMY, EURO, EUROPEAN CENTRAL BANK, FINANCIAL CRISIS 2008/2009, FOREIGN POLICIES, FRANCE, GERMANY, GREECE, INTERNATIONAL, INTERNATIONAL RELATIONS, LUXEMBOURG, NETHERLANDS, PORTUGAL, RECESSION, SLOVAKIA, THE EUROPEAN UNION | Leave a Comment »

JAPAN, GERMANY PUSH SPENDING PLANS

Posted by Gilmour Poincaree on December 27, 2008

26 Dec 2008, 01:01 hrs IST

Reuters

PUBLISHED BY ‘THE ECONOMIC TIMES’ (India)

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PUBLISHED BY ‘THE ECONOMIC TIMES’ (India)

Posted in BANKING SYSTEMS, CENTRAL BANKS, COMMERCE, CURRENCIES, DEUTSCHMARK (Germany), ECONOMIC CONJUNCTURE, ECONOMY, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, GERMANY, INTERNATIONAL, JAPAN, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, THE FLOW OF INVESTMENTS, YEN (Japan) | Leave a Comment »

TOUGH CLIMATE GOALS MAY BE EASIER THAN FEARED

Posted by Gilmour Poincaree on December 26, 2008

December 22, 2008

by Alister Doyle – Environment Correspondent – Reuters Environment

PUBLISHED BY ‘SCIENTIFIC AMERICAN’ (USA)

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Posted in ECONOMIC CONJUNCTURE, ECONOMY, ENERGY INDUSTRIES, ENVIRONMENT, EUROPE, FINANCIAL CRISIS 2008/2009, FOREIGN POLICIES, GERMANY, GLOBAL WARMING, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, INTERNATIONAL RELATIONS, METALS INDUSTRY, MINING INDUSTRIES, NETHERLANDS, PAPER INDUSTRIES, RECESSION, REFINERIES - PETROL/BIOFUELS, THE FLOW OF INVESTMENTS | Leave a Comment »

IRANIAN PRESIDENT TAKES A SHOT AT THE WEST IN A CHRISTMAS MESSAGE – MAHMOUD AHMADINEJAD, IN A VIDEO FOR CHANNEL 4’S ‘ALTERNATIVE CHRISTMAS MESSAGE,’ OFFERS WARM GREETINGS BUT SAYS THE WEST’S BULLYING LEADERS AND THEIR POLICIES WOULD BE SHUNNED BY JESUS

Posted by Gilmour Poincaree on December 25, 2008

December 25, 2008

by Borzou Daragahi

PUBLISHED BY ‘THE L.A. TIMES’ (USA)

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PUBLISHED BY ‘THE L.A. TIMES’ (USA)

Posted in AUSTRALIA, BELGIUM, COMMERCE, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, ENERGY INDUSTRIES, ENGLAND, FINANCIAL CRISIS 2008/2009, FOREIGN POLICIES, FOREIGN POLICIES - USA, FRANCE, GERMANY, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, INTERNATIONAL RELATIONS, IRAN, ISRAEL, ITALY, NORWAY, PETROL, RECESSION, SAUDI ARABIA, SPAIN, THE EUROPEAN UNION, THE MEDIA (US AND FOREIGN), USA | Leave a Comment »

GRIM OUTLOOK FOR RICH NATIONS

Posted by Gilmour Poincaree on December 25, 2008

Tuesday, November 25, 2008 – 23:44 Mecca time, 20:44 GMT

AlJazeera

PUBLISHED BY ‘ALJAZEERA’ (Qatar)

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PUBLISHED BY ‘ALJAZEERA’ (Qatar)

Posted in AUSTRALIA, BANKING SYSTEMS, BELGIUM, CENTRAL BANKS, COMMERCE, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, EUROPE, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FRANCE, GERMANY, HOUSING CRISIS - USA, INTERNATIONAL, ITALY, MACROECONOMY, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, SAUDI ARABIA, SPAIN, STOCK MARKETS, THE EUROPEAN UNION, THE FLOW OF INVESTMENTS, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, UNITED KINGDOM, USA | Leave a Comment »

CIMAREX COMPLETES CASH OFFER TO REPURCHASE CONVERTIBLE NOTES

Posted by Gilmour Poincaree on December 17, 2008

Tuesday, December 16, 2008

Cimarex Energy Co.

PUBLISHED BY ‘THE RIGZONE’

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PUBLISHED BY ‘THE RIGZONE’

Posted in BANKING SYSTEMS, CENTRAL BANKS, ECONOMIC CONJUNCTURE, ECONOMY, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, GERMANY, INTERNATIONAL, RECESSION, THE FLOW OF INVESTMENTS | Leave a Comment »

EURO ZONE Q3 EMPLOYMENT FALLS, FIRST TIME ON RECORD

Posted by Gilmour Poincaree on December 17, 2008

December 16, 2008

Reuters

PUBLISHED BY ‘THE FINANCIAL MIRROR’ (Cyprus)

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PUBLISHED BY ‘THE FINANCIAL MIRROR’ (Cyprus)

Posted in ECONOMIC CONJUNCTURE, ECONOMY, FINANCIAL CRISIS 2008/2009, FRANCE, GERMANY, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, NATIONAL WORK FORCES, PORTUGAL, RECESSION, RUSSIA, SPAIN, THE EUROPEAN UNION, THE FLOW OF INVESTMENTS, THE WORK MARKET, THE WORKERS, UNITED KINGDOM | Leave a Comment »

CONERGY, GE TO POUR $250M INTO ASIA-PACIFIC CLEAN POWER

Posted by Gilmour Poincaree on December 17, 2008

December 15, 2008

by David Ehrlich – GigaOm

PUBLISHED BY ‘THE NEW YORK TIMES’

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PUBLISHED BY ‘THE NEW YORK TIMES’

Posted in AEOLIC, ASIA, BIOFUELS, BIOMASS, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, ENERGY, ENERGY INDUSTRIES, ENVIRONMENT, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, GERMANY, INDUSTRIAL PRODUCTION, INDUSTRIAL PRODUCTION - USA, INDUSTRIES, INDUSTRIES - USA, INTERNATIONAL, NATURAL GAS, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, SOLAR, STOCK MARKETS, THE FLOW OF INVESTMENTS, USA | Leave a Comment »

GERMAN FIRM BUYS VOLKSWAGEN’S HEAVY TRUCK BUSINESS IN BRAZIL

Posted by Gilmour Poincaree on December 16, 2008

December 15, 2008, 23:57

Reuters

PUBLISHED BY ‘THE GULF NEWS’ (Dubai)

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PUBLISHED BY ‘THE GULF NEWS’ (Dubai)

Posted in AUTOMOTIVE INDUSTRY, BRASIL, ECONOMY, GERMANY, INDÚSTRIA AUTOMOTIVA, INTERNATIONAL | Leave a Comment »

COLD WAR TAKES GLOSS OFF NICOLAS SARKOZY’S PRESIDENCY

Posted by Gilmour Poincaree on December 13, 2008

December 12, 2008

Charles Bremner in Paris – The Times

PUBLISHED BY ‘THE TIMES’ (UK)

The Germans see him as an excitable clown and he raises hackles in the East, but Nicolas Sarkozy wants to extend SARKOZY, ACCORDING TO MERKELhis reign as Europe’s de facto leader after his last summit in the EU chair, which opened yesterday.

The hyperactive French President is convinced that he has galvanised Europe with deft handling of the credit crunch and other crises during his six-month EU presidency.

The satisfaction in Paris is barely dimmed by the most glaring failure of France’s presidency: Mr Sarkozy’s cold war with Angela Merkel, the German Chancellor.

The subdued Ms Merkel, who loathes Mr Sarkozy’s bravura, has been watching videos of the late Louis de Funès, a manic comic actor and Gallic institution, for clues to understanding the ever-agitated President.

Der Spiegel says that the Chancellor sees Mr Sarkozy as an “unfeasibly vain jack-in-the-box”: “She has nothing to counter him apart from her eternal impassiveness. Her fist may be clenched but she keeps it in her pocket.”

“Super Sarko”, who does not claim modesty among his qualities, is telling colleagues that he has triumphed by steering Europe through the financial crunch – with Gordon Brown’s help – and creating a new political purpose in the moribund Union.

Jean-David Levitte, the veteran diplomat who manages foreign policy from the Élysée Palace, said that Mr Sarkozy had swung the balance of power in Europe by winning over second-rank members such as Greece.

As the Czech Republic prepares to take over the presidency next month, Mr Sarkozy’s team has been setting out his plans for maintaining French direction. Last month Ms Merkel scuppered Mr Sarkozy’s attempt to appoint himself chairman of the eurozone for next year during the EU presidencies of two non-euro states. But France has another 18 months as co-chair of an EU-Mediterranean Union that Mr Sarkozy launched last July.

His next plan, not yet announced, is a new “economic and security space” with Russia, Mr Levitte disclosed. Given anger in the West towards Russia’s occupation of northern Georgia, European leaders will be surprised to learn that Mr Sarkozy aims to offer a new security pact to Russia and hopes to bring in Ukraine and Turkey.

Another item to emerge from Mr Sarkozy’s team this week has been the President’s belief that Mr Brown will swap the pound for the single currency, thereby boosting the power of the eurozone. “Do you think that they enjoy seeing sterling in such a state?” asked a senior Sarkozy adviser.

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PUBLISHED BY ‘THE TIMES’ (UK)

Posted in COMMERCE, ECONOMIC CONJUNCTURE, ECONOMY, ENGLAND, EUROPE, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FOREIGN POLICIES, FRANCE, GEORGIA, GERMANY, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, INTERNATIONAL RELATIONS, RECESSION, RUSSIA, THE EUROPEAN UNION, TURKEY, UKRAINE | Leave a Comment »

AIR FRANCE SEEKS PROBE INTO AUSTRIAN AIRLINES SALE

Posted by Gilmour Poincaree on December 12, 2008

Thursday, 12.11.08

Associated Press

PUBLISHED BY ‘THE MIAMI HERALD'(USA)

PARIS – Air France-KLM Group said Thursday it has lodged a complaint with the European Commission, accusing German rival Lufthansa of benefiting unfairly from state aid in its deal to acquire Austrian Airlines.

The French-Dutch carrier dropped out of the running for the Austrian carrier, while Lufthansa agreed last week to buy the Austrian government’s stake in the ailing national airline and offered to buy any outstanding shares.

Air France-KLM said in a statement it “strongly believes that the sale of Austrian Airlines to Lufthansa is not being conducted in the best interest of Austrian Airlines stakeholders and at a fair market price.”

The sale “entails state aid elements that need to be thoroughly investigated by the European Commission,” it said.

Under the agreement, the Austrian government will assume up to euro500 million of the carrier’s debt, which amounted to euro900 million as of last month. Air France-KLM said the deal doesn’t follow the instructions imposed on it during the bidding process.

Lufthansa said it was “convinced that the transaction agreed to last week on the acquisition of Austrian Airlines is in compliance with corresponding statutary requirements.”

Lufthansa also said that the Austrian state holding company had obtained legal opinion showing that the deal conformed to law.

The agreement signed by Lufthansa and officials of the Austrian government’s privatization agency gives the German carrier the state’s 41.56 percent share in Austrian Airlines.

That deal carries a price tag of euro366,000 ($465,000) but foresees additional payments of up to euro162 million depending on whether, and to what degree, Austrian turns profitable again.

Lufthansa has also offered to buy the rest of Austrian Airlines for euro4.44 per publicly held share.

Austria’s government decided in August to sell its share in the country’s flagship carrier. Air France-KLM and S7 of Russia had previously expressed an interest but then dropped out of the bidding.

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PUBLISHED BY ‘THE MIAMI HERALD'(USA)

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EU AGREES $260BN ECONOMY PLAN

Posted by Gilmour Poincaree on December 12, 2008

Friday, December 12, 2008 15:17 Mecca time, 12:17 GMT

PUBLISHED BY ‘AL JAZEERA’ (Qatar)

European Union leaders have agreed a $260bn stimulus package designed to dig the continent’s troubled economies out of recession.

The deal, which see each EU French President Nicolas Sarkozy, right, shares a word with German Chancellor Angela Merkel during a round table meeting at an EU summit in Brussels, Friday Dec. 12, 2008. European Union leaders continue their two days of talks aimed at sealing a final accord on their climate change package to cut emissions by 20 percent by 2020member invest on average the equivalent of 1.5 per cent of gross domestic product (GDP) into their economies in order to temper the impact of a global recession, was reached on Friday at a two-day summit in the Belgian capital Brussels.

“What Europe has proved unanimously today is that it is ready to act in a united way to deal with the global downturn,” Gordon Brown, Britain’s prime minister, said.

“We will continue to reject the do-nothing approach and we will not stand by and let the recession take its course.”

Ahead of the summit, Germany had expressed reservations about ploughing so much public money into the economy and resisted pressure to contribute more than what it judged necessary to revive the German economy again.

Officials revised earlier versions of the conclusions to say the package should be worth “about” 1.5 per cent of GDP rather than “at least” 1.5 per cent as seen in an earlier draft.

Climate change

After securing an agreement in the morning for Ireland to submit a stalled EU reform treaty to a second referendum next year, the 27 leaders were also hoping to reach more common ground on climate change as the day progressed.

Copies of a draft agreement indicated the leaders should commit themselves to warding off the threat of a “recessionary spiral” with the stimulus package and an ambitious climate package.

“In these exceptional circumstances, Europe will act in a united, strong, rapid and decisive manner to avoid a recessionary spiral and sustain economic activity and employment,” the draft conclusion said.

“It will mobilise all the instruments available to it and act in a concerted manner to maximise the effect of the measures taken by the [European] Union and by each member state.”

The EU’s climate-energy package, the “20-20-20” deal, seeks to decrease greenhouse gas emissions by 20 per cent by 2020, make 20 per cent energy savings and bring renewable energy sources up to 20 per cent of total energy use.

Angela Merkel, the German chancellor, said: “The member states still have essential negotiations but I am cautiously optimistic that good conclusions can be reached here and send an important signal” to an international climate conference in Copehagen next December.

Under Ireland’s referendum deal, a new referendum will be held by November 2009 on the controversial treaty in exchange for guarantees on key issues including an assurance that it does not lose its EU commissioner.

Irish voters rejected the treaty, designed to streamline EU decision-making and institutions, at a first referendum in June.

CLICK HERE FOR THE ORIGINAL ARTICLE

PUBLISHED BY ‘AL JAZEERA’ (Qatar)

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EU EDGES CLOSER TO CLIMATE, STIMULUS DEALS – ITALY, POLAND SEE EU CLIMATE DEAL IN OFFING

Posted by Gilmour Poincaree on December 12, 2008

December 12, 2008

by Jan Strupczewski and Pete Harrison – Reuters

PUBLISHED BY ‘THE FINANCIAL MIRROR’

European leaders moved towards agreement on Friday on a multi-billion dollar plan to tackle the global recession and a climate change plan amended to limit impact on struggling industries.

Green groups warned that the European Union could forfeit its credibility as a force in tackling climate change if it accepted too many changes to a plan to cut carbon dioxide emissions by 20 percent by 2020.

One British group said compromises in climate policy, which will be key to world talks next year to produce a successor to the Kyoto pact on climate change, could amount to a ‘meltdown’.

The climate discussions took on a special significance, taking place some six weeks before Barack Obama takes over the U.S. presidency holding out the prospect of closer co-operation in matters of global warming.

Italian Prime Minister Silvio Berlusconi, who had threatened to veto a deal without concessions to protect key industries, emerged from the first day of a two-day summit, declaring: “We are heading towards a compromise…We are getting what we want.”

Poland, which had demanded concessions on its heavily polluting coal-based power industry, was also cautiously optimistic.

“The prime minister (Donald Tusk) achieved everything he wanted in negotiations on the climate package,” an official told Reuters. “The deal is flexible, allowing for the modernisation of the Polish power sector.”

HISTORIC?

The economic crisis sweeping Europe has further complicated climate talks that had already raised tensions in a 27-member bloc embracing former Soviet bloc states besides western Europe.

German Chancellor Angela Merkel, who opposes the heavy spending advocated by Britain and France for fear it could lead to escalating budget deficits, said at the start of the summit she was nonetheless keen to seal a 200 billion euro ($260 billion) stimulus package, amounting to some 1.5 percent of GDP.

Luxembourg Prime Minister Jean-Claude Juncker said on Thursday evening he thought EU leaders would agree on the main lines of the economic package and the climate deal on Friday.

“The economic crisis will pass, the climate crisis will stay. We have to do something,” he told reporters.

Finnish Foreign Minister Alexander Stubb said Friday would bring a ‘historic decision’ on energy and climate change.

‘Europe is going to show the way,’ he said.

Several leaders stressed the need to maintain the EU’s ambitious targets; but Merkel, seeking to limit damage to industry, appeared to have secured compromises.

Steel, cement, chemicals, paper and other industries will be sheltered from the added cost of buying permits to emit carbon dioxide from the EU’s flagship emissions trading scheme (ETS), according to a draft text that formed the basis for talks.

“This covers about 90 percent of industry, and I don’t see any reason why Germany would not accept this proposal,” German conservative Peter Liese told Reuters. “I see it as a victory.”

British Green group member Caroline Lucas said the proposals represented ‘the lowest possible common denominator’.

‘The eyes of the world are on the EU. The EU’s credibility as a leading actor on climate change is in freefall. It’s not too late for heads of state and government to intervene and save face.’

EASE THE SHOCK

In their first session of the summit, leaders agreed in principle on a set of concessions to Ireland enabling Dublin to hold a second referendum by next November on the Lisbon treaty, intended to streamline EU decision making. The treaty was rejected at a first poll and needs approval from all states.

“There was no opposition, there was no objection, there was no veto,” one European official said. Another stressed that the agreement was only provisional and there would be talks on the details of the arrangements on Friday.

The Lisbon Treaty — successor to the defunct EU constitution — aims to give the bloc more weight in the world by creating a long-term president and its own foreign policy supremo.

EU leaders aim to agree how to reach targets of slashing carbon emissions by 20 percent by 2020 and winning 20 percent of the bloc’s energy from renewable sources such as wind and solar power by that date, ahead of global talks next year on a successor to the Kyoto agreement from 2012.

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PUBLISHED BY ‘THE FINANCIAL MIRROR’

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SIEMENS FINANCIAL SERVICES INC. HAS ACQUIRED 30% STAKE IN THE TORP TERMINAL LP, IN HOUSTON, TX

Posted by Gilmour Poincaree on December 11, 2008

Monday, December 10, 2008

Distributed by Press Release

PUBLISHED BY ‘THE EXAMINER’

ISELIN, N.J., Dec. 10 /PRNewswire/ – Siemens Financial Services, Inc. (SFS Inc.), the U.S. financing unit of Siemens AG, has taken a 30% equity interest in TORP Terminal LP. TORP Terminal LP, with headquarters in Houston, TX, is a limited partnership owned by TORP Technology Inc., TORP Technology AS, and SFS Inc.

TORP Technology AS has developed the award winning technology, the HiLoad LNG Regas, which will be applied at the Bienville Offshore Energy Terminal, to receive and re­gasify liquefied natural gas (LNG). TORP Terminal has filed an application for a license under the Deep Water Port Act to build, own and operate the terminal in the Gulf of Mexico.

The Bienville Offshore Energy Terminal will be located 63 miles south of Dauphin Island, Alabama, in 450 ft of water, and will utilize TORP’s proprietary HiLoad Technology in an environmentally sound way for cost­effective offloading of LNG carriers offshore.

Lars Odeskaug, CEO of TORP Technology AS, explained: “The HiLoad Technology enables us to safely dock onto any LNG carrier, unload and re­-gasify the LNG at very attractive rates. TORP selected the site offshore Alabama for the terminal due to its strategic location downstream of Henry Hub and with high takeaway capacity to some of the best gas markets in the U.S. We are pleased that Siemens has arrived at the same conclusion, both with respect to technology and location, and we look forward to move the project forward with Siemens as a strong partner.”

“Siemens thrives on innovation and we recognized in this project another opportunity to invest in an innovative technology” says Johannes Schmidt, Head of Equity & Project Finance. “At SFS, we see ourselves as enabler of business expansion that understands the challenges its customers face and creates customized financial solutions to help solve them.”

About Siemens Financial Services (SFS)

Siemens Financial Services (SFS) is an international provider of financial solutions in the business­to­business area. With about 1,900 employees and an international network of financial companies coordinated by Siemens Financial Services GmbH, Munich, we support Siemens as well as non-­affiliated companies, focusing on the three sectors of energy, industry and healthcare. We finance infrastructure, equipment and working capital and act as a competent manager of financial risks within Siemens. By leveraging our financing expertise and our industrial know­-how we create value for our customers and help them strengthen their competitiveness. For more information see: www.siemens.com/finance.

Siemens Financial Services, Inc. (SFS Inc.) is a leading provider of business­-to-­business financial services in the United States. SFS is a committed business ally that combines deep industry expertise with integrated financing solutions to enhance the efficiency, productivity, and competitiveness of its customers. The company, based in Iselin, NJ, enables business expansion for thousands of customers in the healthcare, energy, and industrial sectors by providing customized solutions that range from equipment financing and working capital to project and export finance, and insurance solutions. Further information on Siemens Financial Services in the United States: www.usa.siemens.com/financial.

About Siemens

Siemens AG (NYSE: SI) is a global powerhouse in electronics and electrical engineering, and operates in the industry, energy and healthcare sectors. For more than 160 years, Siemens has built a reputation for leading­-edge innovation and the quality of its products, services and solutions. With 428,000 employees in 190 countries, Siemens reported worldwide sales of $116.6 billion in fiscal 2008. With its U.S. corporate headquarters in New York City, Siemens in the USA reported sales of $22.4 billion and employs approximately 69,000 people throughout all 50 states and Puerto Rico. For more information on Siemens in the United States, visit www.usa.siemens.com.

About TORP Terminal LP

TORP Terminal LP is based in Houston, TX. The company is a limited partnership owned by TORP Technology Inc., TORP Technology AS (Stavanger, Norway) and Siemens Financial Services Inc. The company has the rights to utilize the HiLoad LNG Re-­gasification technology at the Bienville Offshore Energy Terminal. The HiLoad LNG Re­-gasification unit is a floating L-­shaped terminal that docks onto the LNG carrier using the patented friction based attachment system (rubber suction cups) creating no relative motion between the carrier and the terminal. The HiLoad LNG Re­-gasification unit is equipped with standard re­-gasification equipment (LNG loading arms, pumps and vaporizers) and can accommodate any LNG carrier without the use of any special equipment. The terminal uses air for heating the LNG, saving fuel costs. For more information on TORP Terminal LP, go to http://www.torplng.com.

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PUBLISHED BY ‘THE EXAMINER’

Posted in COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, ENERGY, ENERGY INDUSTRIES, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FINANCIAL SERVICES INDUSTRIES, GERMANY, INDUSTRIAL PRODUCTION, INDUSTRIAL PRODUCTION - USA, INDUSTRIES, INDUSTRIES - USA, INTERNATIONAL, MEXICO, NATIONAL WORK FORCES, NATURAL GAS, RECESSION, STOCK MARKETS, THE FLOW OF INVESTMENTS, THE WORK MARKET, THE WORKERS, USA | Leave a Comment »

FRENCH ECONOMY SURPASSING U.K., REPORT FINDS

Posted by Gilmour Poincaree on December 11, 2008

December 8, 2008

Bloomberg News

PUBLISHED BY ‘THE INTERNATIONAL HERALD TRIBUNE’ (USA)

PARIS: The financial crisis is recasting the league table of economies, with Britain sliding behind its European neighbors and China gaining on its richer rivals, the Center for Economics and Business Research said in a study released Monday.

A recession and a decline in the pound’s value pushed Britain’s gross domestic product below France’s this year and it will be passed by Italy in 2009, the CEBR said in the report. China has overtaken Germany and will top Japan in 2010 to become the world’s second-largest economy behind the United States, it said.

“The recession associated with the credit crunch will change the position of many countries in the world’s GDP league table,” the London-based CEBR said in the report.

The study shows how countries that ran up debts during expansion, like Britain, will now suffer, while emerging-market economies will wield increasingly more power in the global economy as they develop. Governments from the Group of 7 nations are under pressure to broaden their membership to reflect the changing shape of the world economy.

Brazil will rise to eighth-biggest economy from 10th by 2010 and India to 10th from 12th, the CEBR said. Canada will drop to 13th from ninth in the same period as its currency falls, it said.

The CEBR also said the British and Italian economies would suffer the deepest downturns with 18 quarters of GDP below its previous peaks. Spain’s slump will last 16 quarters and Japan’s 11 quarters. The United States will rebound after nine quarters. China will not suffer a single quarter of contracting growth, the report said.

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PUBLISHED BY ‘THE INTERNATIONAL HERALD TRIBUNE’ (USA)

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DEUTSCHE POST CEO SEES SHORT RECESSION, ASIA EXPANSION

Posted by Gilmour Poincaree on December 11, 2008

December 11, 2008

Tehran Times Political Desk

PUBLISHED BY ‘TEHRAN TIMES’ (Iran)

SINGAPORE (Reuters) – Deutsche Post chief executive Frank Appel said on Wednesday the firm will continue its Asian expansion and keep job cuts to a minimum outside the United States as it expects a short but sharp global recession.

“We are pretty confident that the recession will be deep but pretty short,” he said, predicting business and consumer confidence can recover as quickly as it had disappeared in recent weeks. “We don’t have to cut too many jobs.”

Appel said that Deutsche Post’s DHL unit, Europe’s largest express courier company, had invested around $2 billion in Asia in recent years, and “we will see similar numbers in coming years”.

DHL last month said it will halt U.S. domestic services and cut 9,500 jobs after failing to gain share in a market dominated by United Parcel Service and FedEx Corp.

FedEx on Monday warned that earnings for its fiscal year ending May 2009 will be lower than expected due to a global economic slump.

Appel, who spoke at a briefing on a global trade study commissioned by DHL, was more bullish about economic prospects, saying he expected the global economy to recover faster than most people thought.

According to the study by the Economist Intelligence Unit, trade between Asia and the West will shrink by about 4 percent in 2009 before recovering in 2010, recovering faster than cross-Atlantic traffic, which will likely remain in the doldrums until 2011.

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PUBLISHED BY ‘TEHRAN TIMES’ (Iran)

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WHERE HAVE ALL YOUR SAVINGS GONE? – INVESTORS MAY DRAW THE WRONG LESSON FROM HISTORY

Posted by Gilmour Poincaree on December 11, 2008

Dec 4th 2008

From The Economist print edition

PUBLISHED BY ‘THE ECONOMIST’

For American and European savers it has been a lost decade. After two booms and two busts, stockmarkets have earned them nothing, or less, in the past ten years. Low interest rates have made bonds and bank deposits unrewarding too. Were it not for the tax relief they receive, contributors to personal pension plans would have been better off keeping their money under their mattresses. It will be little consolation to Westerners that savers in Japan have known this empty feeling for far longer.

This year’s figures are enough to put anybody off saving. American mutual-fund assets have declined by $2.4 trillion—a fifth of their value—since the start of 2008; in Britain, the drop is more than a quarter, or almost £130 billion ($195 billion). The value of global stockmarkets has shrunk by maybe $30 trillion, or roughly half. These figures put the losses on credit-related securities—where the financial crisis began—into the shade.

Nor has the bad news been confined to equities. This year the value of all manner of risky investments, from corporate bonds to commodities to hedge funds, has been clobbered. The belief that diversification into “alternative assets” could prevent investors losing money in bear markets has proved false. And of course housing, which many people counted on for their retirement nest-eggs, has lost value too (see article).

As a result, saving seems like pouring money into a black hole (see article). Any American who has diligently put $100 a month into a domestic equity mutual fund for the past ten years will find his pot worth less than he put into it; a European who did the same has lost a quarter of his money.

Save your cake and eat it

It may seem an odd time to worry about savings. This week the National Bureau of Economic Research declared that the world’s largest economy, America, had been in recession since December last year. The economies of Japan and much of western Europe have been shrinking. A rapid, global, private-sector shift to thrift is exactly what the world economy does not need. That’s why governments around the world have been passing hurried measures to try to encourage people to spend more of their incomes.

In some countries, they should. Asians (and Germans too — see article), have been squirrelling their money away with excessive enthusiasm. But other countries’ citizens have been putting too little aside for their old age. In America, the household savings ratio (the proportion of disposable income not used for consumption) has been below 2.5% since 1999; in Britain, it has been below 3% in each of the past two years. The Asians’ parsimony made the Anglo-Saxons’ profligacy possible. Through their increasingly sophisticated financial systems, the Americans and British were able to borrow from the thrifty Asians to finance their spending spree. And, because their house prices were rising so fast, they had the collateral and the confidence to do so.

In other words, Anglo-Saxons were able to save their cake and eat it. They did not have to sacrifice consumption in order to build up assets for the future, because lax monetary policies encouraged borrowing that pushed up the prices of housing and other assets, which gave them the illusion of having saved enough. But now this debt burden is being unwound, asset prices are collapsing and savings rates are rising because consumers are unwilling, or unable, to borrow.

Though this is bad news for the American and British economies in the short term, it ought to be good news in the long term. How good, though, depends as much on where people put their savings as on how much they put aside.

Careless caution

If savers treated financial assets as they do other goods, they would sell them when they are expensive and buy them when they are cheap. Actually, they do the opposite. They piled into the market in 1999-2000, at the peak, and are piling out of it now. They should, of course, have got out in 2000, when the global price-earnings ratio was 35; shares look relatively much more attractive now, since the ratio is down to ten. A recent analysis shows that, when American price-earnings ratios are low, returns on equities over the next decade average 8%; when they are high, returns average 3%.

But people’s recent losses have made them cautious. They are putting their money into cash or money-market funds, rather than equities or corporate bonds. The returns they are getting on their savings look increasingly pitiful. Interest rates are falling sharply, with more central banks announcing cuts this week. Savers may initially be shielded from the full impact of those reductions, because commercial banks are competing for retail deposits. But rates in many big economies are heading for, or have already reached, 1-2%.

Caution is understandable, after the trauma of this year. Equity and corporate bond markets could yet fall further, especially as the news on the economy seems to get worse every week. But it is still perverse that investors were happy to buy shares nine years ago, when the ratio of share prices to profits was three times what it is today, and are now determined to keep their money in cash and bonds.

That approach will be hopelessly inadequate for those who want to build a decent pension, especially in defined-contribution, or money-purchase, schemes, where the employee bears all the investment risk. The average American scheme member contributes just 7.8% of salary to his pension scheme. His employer, on average, contributes only 4.4%. He has a pot worth only $68,000. A rule of thumb is that total contributions need to be around 20% of wages to match a traditional final-salary scheme.

Inadequate savings, badly invested, are a problem for individuals and the economy. Cautious savers are putting their money in banks; banks are reluctant to lend; companies therefore find it hard both to borrow money and to raise equity capital. This timidity hurts companies and, in the long term, savers. Implausible as it may sound, right now equities and corporate bonds are a better long-term bet than cash.

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PUBLISHED BY ‘THE ECONOMIST’ (Spain)

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BIG FOUR POISED TO TAKE OVER COMMERCIAL LENDING – The major Australian banks will be forced to shoulder a greater share of commercial lending, as international banks retreat from the domestic financing market (Australia)

Posted by Gilmour Poincaree on December 10, 2008

December 11, 2008

by Scott Murdoch – The Australian

PUBLISHED BY ‘THE AUSTRALIAN’

A report from Deutsche Bank has found that $84 billion worth of corporate debt is to be refinanced over the next two years, forcing company directors to examine their equity options.

The investment bank said in the first half of this year, the top four banks were responsible for half the new syndicated loan allocations.

The portion taken by the domestic banks was up from 34 per cent in 2007, after a marked contraction in activity by US and European banks.

So far this year, the European share has retreated from 34 per cent to 28 per cent, and US bank participation has more than halved from 14 per cent 6 per cent.

The report said since 2006, $280 billion worth of syndicated debt was raised in Australia, of which 60 per cent is held by offshore banks.

Deutsche Bank’s head of leveraged finance Marla Heller said the increase in corporate activity over the past two years had led to the significant amount of debt raisings.

“There has been growth from 2005 to 2007. A big driver of that is the private equity and the leveraged buyouts,” Ms Heller said.

“Also, from 2006 and 2007 there were a significant number of corporate refinancings.

“I think in the first half of 2008, we saw the retreat of foreign banks. The Australian banks will be more like the cornerstones.”

It has been estimated the most debt due to mature is held among real-estate investment trusts, utilities and infrastructure.

Deutsche predicts international banks will depart since the introduction of regulations requiring companies to have better financial coverage of their assets.

“It is hard to see the Australian banks having all of the capacity to fill the void,” Ms Heller said in reference to the retreat of foreign banks.

“We will see opportunities for other entrants coming in and that won’t be just the banks but private equity.

“I think corporates are going to have to look at how they support themselves from a capital point of view.”

Deutsche Bank’s managing director of global banking in Australia, David Backler, said there would be a growing role from private equity firms which, globally, are holding almost $1 trillion worth of cash.

He said: “There are going to be large effects with $84 billion worth of debt maturing. Where is that going to come from?

“We think that the Australian banks have a big job to do because of the foreign banks retreating.

“The offshore debt markets are challenged. That is going to lead people down the path of equity raisings and more private equity.”

Deutsche has forecast lending and refinancing deals will be structured differently in 2009, with fewer banks in large scale syndicates.

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PUBLISHED BY ‘THE AUSTRALIAN’

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CUBAN TOURISM SURGES AS REST OF CARIBBEAN STALLS – Tourism In Cuba Up Nearly 11 Percent Despite 3 Hurricanes

Posted by Gilmour Poincaree on December 10, 2008

HAVANA, Dec. 8, 2008

The Associated Press

PUBLISHED BY ‘CBS NEWS’ (USA)

(AP) Cuba’s vacation industry has remained as hot as the tropical sun here, even as the world economic crisis sparks cancellations and layoffs elsewhere in the Caribbean.

The communist country says it’s booked solid through December and expects a record 2.34 million visitors this year _ largely because global financial woes have so far been softer on Canada, its top source of visitors.

Luck also played a role: While the island suffered three devastating hurricanes, its key tourist sites were largely spared. And where beachfront resorts did get hit, the tourist-hungry government has made sure to repair hotels _ in some cases even before damaged homes and infrastructure. Tourism is Cuba’s second-largest source of foreign income, behind nickel production.

So while other islands in the region are laying off hotel workers and suspending construction of new property, Cuban resorts are gearing up for a strong season.

“We’ve had a few cancellations, but overall our numbers are still strong,” said David Gregori of WowCuba, a travel agency in Charlottetown, Canada, that specializes in bicycle trips and other Cuba tours. “People still like to get away. They might try to save some money while doing it, but they’re still traveling.”

The number of foreign visitors has swelled nearly 11 percent this year, making up for 4 and 3 percent declines in 2006 and 2007, government figures show.

Officials offer no explanation for those slower years. But tour operators blame the island’s low returning-visitor rates: Some tourists complain of poor service, crumbling infrastructure and lousy food, indicative of a communist system where shortages are common and state employees are unaccustomed to putting customer service first.

Still, the island is often cheaper than its subtropical neighbors, because many foreigners buy all-inclusive packages offering dozens of direct flights from Europe and Canada to airports all over Cuba, as well deep discounts on hotels, food and booze.

Others are enticed by the prospect of seeing one of only five communist countries left on the planet.

“A lot of people who are going for simple fly-and-flop holiday, and there are others who are going for history and culture, dancing, music,” said Julia Hendry, marketing director for Europe and the United Kingdom of the Bahamas-based Caribbean Trade Organization. Cuba has both, she said, “whether it’s swimming and beach or the excitement of Old Havana and Cuban history.”

About 35 percent of this year’s tourists have been Canadian, with 635,000 visiting through September, one-fifth more than in the same period last year. Canada’s economy has not suffered the same losses now sapping the savings of homeowners in the U.S.

Russian tourists rose 40 percent to top 28,000 thru September, and Cuban Tourism Minister Manuel Marrero traveled to Moscow last month to further promote his country.

Visitors from Britain, Italy, Spain and Germany, the top suppliers of tourists after Canada, declined between 3 and 5 percent respectively, however.

Washington’s trade embargo prohibits Americans from visiting, though island immigration records show about 41,000 came last year, many presumably without permission. But not relying on U.S. tourists may now be a blessing.

“Canadians are going to keep coming, especially with snow at home,” said Helen Lueke of Sherwood Park, Canada, who has vacationed in Havana about once a year for decades.

Alexis Trujillo, Cuba’s deputy secretary of tourism, predicted full bookings at least through next summer.

“There’s no doubt tourism is always sensitive to everything,” he said of global economic turmoil. “But we don’t think that for Cuba that will mean an important decrease.”

Tourism generated $2.2 billion for Cuba in 2007. The government has announced no plans to delay a $185 million plan to upgrade more than 200 resorts and build 50 boutique hotels by 2010 _ nt even after Hurricanes Gustav, Ike and Paloma hit within two months, causing more than $10 billion in damages and crippling farms and infrastructure across the countryside.

Construction crews assigned to vacation properties in Havana and elsewhere have largely continued working as normal since the storms.

In the eastern province of Holguin, the island’s No. 3 tourist destination after Havana and the beach resort of Varadero, officials prioritized hotel repairs, trucking in workers to rebuild beachfront resorts. Holguin expects about 270,000 foreigners this year, about the same as 2007, despite scores of hurricane-related cancellations.

Havana’s decaying yet picturesque historic district saw little damage, as did Varadero, 90 miles (140 kilometers) to the east, where white sand and warm, see-through surf has enticed everyone from Fidel Castro to Al Capone. A record million visitors are expected to stay in the town’s 7,000 hotel rooms, which range in price from about $120 to $350 per night, with meals and open bar included.

Though European tour operators say sales have slowed since the financial crisis deepened in October, they expect trips to Cuba and some other Caribbean destinations to stay strong through the winter. Europeans are putting off short, side trips closer to home, but many families are still willing to splurge on once-a-year trips to the tropics, Hendry said.

“We have noticed that all-inclusive markets, where travelers can budget in advance, seem to be doing relative well. Cuba is quite well-populated with that sort of property,” she said.

The industry could get another boast if President-elect Barack Obama keeps campaign promises to ease restrictions on Cuban Americans who want to visit their relatives on the island. Currently, those with family here can only come once every three years.

Nelson Gonzalez, a 56-year-old physical therapist, said his mechanic brother in Miami last came to visit in 2007. But his brother called the morning after the U.S. election to say he was reserving a seat on one of the many special charters that fly from the U.S. to Havana for the last week in January _ confident Obama will ease family travel rules immediately after his Jan. 20 inauguration.

“When your family members reach a certain age, you don’t know if in three more years everyone will still be here,” said Gonzalez, who lives with his 80-year-old parents.

Though visiting family members spend less than tourists, Gregori said many Cuban Americans use his company to book rental cars in advance of visiting relatives.

But “if you want to rent a car in Havana in December, I don’t have any,” he said. “They’ve been sold out for months, and every year they get sold out earlier and earlier.”

CLICK HERE FOR THE ORIGINAL ARTICLE

PUBLISHED BY ‘CBS NEWS’ (USA)

Posted in BARACK HUSSEIN OBAMA -(DEC. 2008/JAN. 2009), CANADA, COMMERCE, CUBA, ECONOMIC CONJUNCTURE, ECONOMY, EUROPE, FINANCIAL CRISIS 2008/2009, FOREIGN POLICIES, FOREIGN POLICIES - USA, GERMANY, INDUSTRIES, INTERNATIONAL, INTERNATIONAL RELATIONS, ITALY, NATIONAL WORK FORCES, RECESSION, RUSSIA, SPAIN, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, THE WORK MARKET, THE WORKERS, TOURISM INDUSTRIES, UNITED KINGDOM, USA | Leave a Comment »

THE BIG THREE NEED A SHAKEOUT, NOT A BAILOUT

Posted by Gilmour Poincaree on December 9, 2008

Tuesday, December 9th, 2008

by Keith Fitz-Gerald – Investment Director

PUBLISHED BY ‘MONEY MORNING’

Money Morning/The Money Map Report

I don’t know about you, but my jaw literally hit the floor when the chief executives of Detroit’s “Big Three” begged for a taxpayer-funded bailout. Never mind that General Motors Corp (GM), Ford Motor Co. (F) and Chrysler LLC are now seeking an aggregate $34 billion – which is up 36% from the $25 billion the Big Three was seeking just two weeks ago – or that they “drove” to Capitol Hill in a caravan of new hybrids so shiny they could’ve made the Keystone Cops green with envy.

And now that negotiations are under way to “advance” the three U.S. automakers $15 billion from an existing loan program, I don’t know whether to laugh … or to cry, since the total amount actually needed may be north of $150 billion.

The bottom line: Detroit doesn’t need a bailout.

It needs a shakeout.

How to Really Assess the Big Three’s Health

Nothing drove that point home more than when Ford CEO Alan R. Mulally who, after admitting “big mistakes,” attempted to sway Congressional members by saying that “we’re really focused now.”

I may not be the brightest bulb in the bunch here, but it seems to me I’ve heard this same mea culpa before – several times. Indeed, wasn’t that what the Big Three said:

– Back in the 70s, after Japanese-made cars that were better made and more economical started grabbing huge swaths of U.S. market share.

– Back in the 80s when U.S. quality began to suffer badly.

– And again back in the 90s when they tossed their lot in with SUVs and trucks.

But I really have to question whether GM, Ford and Chrysler were “really focused” after supposedly beating back each of these challenges, since the Big Three has seen its market share drop from more than 70% then to less than 50% today.

They’re so “focused” I can’t stand it. And I can only wonder what they’ll say when Chinese automakers hit our shores in the next few years, rolling out cars that sell for 30% less than it costs Detroit to make cars for.

Even at their new salaries of $1 a year, the Big Three’s top leaders are overpaid in my book – but I digress.

The so-called Big Three are nowhere near the anchor of American industry that Detroit would have us believe. And the arguments they’re using are superficial – at best. Maybe that’s good enough to bamboozle some people, but I believe that the American public is smarter than that. I can’t speak for our elected leaders who seem hell bent for leather on sticking band-aids on all our serious problems, but that, too, is another story for another time.

Essentially, the carmakers’ case boils down to this: Each of the Big Three – GM, Ford and Chrysler – contribute billions of dollars to the U.S. economy, and directly or indirectly employ three million Americans. Thus, by allowing any or all of the automakers to fail, lawmakers would be making a major economic misstep.

That might be true, but not for the reasons the automakers have stated.

The Big Three are manufacturers. You don’t measure their success or failure by how much they purchase. You measure it by how much they sell, whether their market share is rising or falling, and what customers are saying about the quality and functionality of the finished product.

Economics 101

That brings us to the basics of supply and demand. If you recall your freshman-level Economics 101 course, “supply” is the total amount of goods and services (in this case cars and related support services) available for purchase. Demand is the amount of a particular good or services that a consumer or consumers will want to purchase at a given price.

Demand curves are normally downward sloping because consumers typically buy less of an item as its price increases. Similarly, supply curves are upward sloping because producers are willing to supply increasing amounts of their wares at increasingly higher prices. A bit of an oversimplification, perhaps, but it makes the general point.

In their rush to portray their industry as an economic linchpin and supplier of key future technologies – not to mention as a “victim” of the worst financial crisis since The Great Depression – the U.S. automakers are forgetting that their failure will not bring about a total destruction of demand. History is literally littered with failed companies. Demand for cars won’t fall off because the Big Three go under anymore than folks would stop buying beer if Annheuser-Busch Cos. Inc. (the maker of Budweiser that’s now Annheuser-Busch InBev NV) were to collapse and disappear.

What’s far more likely to happen is that Japan’s Honda Motor Co. (ADR: HMC) and Toyota Motor Co. (ADR: TM), India’s Tata Motors Ltd. (ADR: TTM), Germany’s Daimler AG (DAI) and Bayerische Motoren Werke AG (BMW), China’s Chery Automobile Co. Ltd. and Geely Automobile Holdings Ltd., and other companies from around the world will happily fill the void.

In fact, I’m certain that these companies will not only absorb key elements of the purchasing chain, but the workers, too. History shows that industry consolidation is actually a positive influence for the remaining companies and their workers. History also demonstrates that during periods of industry consolidation, there really isn’t anything other than short-term loss in business activity.

In short, if the demand is there, other firms will move in.

What Detroit is actually seeking is a bailout that preserves the status quo, and that implicitly rewards 40 years of inept management, bad decisions and poor quality. But to my way thinking, it makes no sense whatsoever to throw $34 billion at businesses that are losing $6 billion a month.

Like the other federal bailouts that I’ve opposed (as a proponent of free markets and the Austrian school of economics, I believe that bailouts are fundamentally wrong), a taxpayer-funded bailout of the U.S. auto sector would do nothing to improve Detroit’s competitive position. Instead, the capital would serve as little more than a punitive tax on such successful companies as Toyota and Honda, just to name two of the most obvious that would suffer. It would also allow Detroit to come back for more money after they blow through whatever we give them now. In the end, that will hurt both the consumer and the taxpayer – in most cases, one and the same.

Congressional sources are saying that that before the Big Three gets a cent, they would each have to make concessions similar to those extracted from the U.S. financial-services sector. Not only would the automakers have to eradicate their dividends and guarantee repayment, they’d also have to willingly submit to government control, just in case things didn’t play out as planned.

Maybe I’m the only one who sees a problem with this but such a change would mean that the same people who have been running the U.S. Postal Service would not be in charge of both Wall Street and one of our major manufacturing industries.

No thank you.

There are still plenty of strong automobile companies operating in the U.S. market that are able to offer of successful products that range from ultra-plain utilitarian models to all sorts of luxury vehicles, with to large-scale trucks in between.

And if the Big Three were to fail, still more auto firms will come to the United States, as their many foreign predecessors did in the years before.

So here’s to the natural order of things and, hopefully, a levelheaded Congress that will let the markets take their natural course and force a shakeout – and not a bailout.

CLICK HERE FOR THE ORIGINAL ARTICLE

PUBLISHED BY ‘MONEY MORNING’

Posted in AUTOMOTIVE INDUSTRY, BANKING SYSTEM - USA, BANKRUPTCIES - USA, CHINA, COMMERCE, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FOREIGN POLICIES - USA, GERMANY, INDIA, INDUSTRIAL PRODUCTION - USA, INDUSTRIES - USA, INTERNATIONAL, INTERNATIONAL RELATIONS, JAPAN, MACROECONOMY, NATIONAL WORK FORCES, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, STOCK MARKETS, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, THE WORK MARKET, THE WORKERS, USA | Leave a Comment »

LUFTHANSA SUPERVISORY BOARD APPROVES ACQUISITION OF AUSTRIAN AIRLINES – Lufthansa will initially acquire the 41.56 per cent share in Austrian Airlines AG

Posted by Gilmour Poincaree on December 9, 2008

Monday, December 08, 2008

by Tatiana Rokou

PUBLISHED BY ‘TRAVEL DAILY NEWS’

Lufthansa will initially acquire the 41.56 per cent share in Austrian Airlines AG held by Osterreichische Industrieholding AG (OIAG). This share package is to be acquired at a price of EUR 366,000. In addition to this, a debtor warrant will be arranged, of which Lufthansa will pay a sum of up to EUR 163m depending on Austrian Airlines’ economic performance and the Lufthansa share outperforming its competitors.

In the course of the period specified by Austrian takeover law, Lufthansa will also make a public takeover bid to Austrian Airlines’ free float shareholders. The company is applying to the Austrian Takeover Commission for an extension of the notification period to the longest permissible time. The bid price will correspond to the average weighted market price of the Austrian Airlines share over the six months preceding this announcement. Subject to an examination by the Takeover Commission, this figure will be EUR 4.44 per share. In total, some EUR 215m will be offered to private and institutional free float shareholders as part of the takeover bid.

Wolfgang Mayrhuber, Chief Executive Officer Lufthansa Group, said: “Gaining the support of our Supervisory Board for the acquisition of Austrian Airlines is an important step which paves the way for OIAG, the government in Vienna and the European Commission to make their decisions following due consideration of the transaction. Our bid is fair. It takes the interests of all those concerned into account and shares the encumbrances and risks fairly. The consequences of the financial markets crisis and its effects on the real economy also have a major impact on the aviation industry. Structural changes increase the likelihood of Lufthansa and Austrian Airlines sharing a brighter future.”

The OIAG Supervisory Board meeting to approve the proposed transaction is to be held on 5 December 2008. The parties then intend to sign the appropriate contracts. Execution of these contracts is subject, inter alia, to the conditions precedent of anti-trust approval and the approval of a EUR 500m restructuring grant to be made by the Republic of Austria, both of which must be granted by the European Commission. Furthermore, Lufthansa must hold 75 per cent of the shares in Austrian Airlines – including those transferred by OIAG – after the end of the regular acceptance period for the public takeover bid.

CLICK HERE FOR THE ORIGINAL ARTICLE

PUBLISHED BY ‘TRAVEL DAILY NEWS’ (UK)

Posted in AIR TRANSPORT INDUSTRY, ECONOMIC CONJUNCTURE, ECONOMY, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, GERMANY, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, RECESSION, THE FLOW OF INVESTMENTS | Leave a Comment »

NO ROOM FOR WISHFUL THINKING – THE SLUMP IS HERE WITH A VENGEANCE (USA)

Posted by Gilmour Poincaree on December 9, 2008

Saturday December 6 2008

by Larry Elliott, Economics Editor – The Guardian

PUBLISHED BY ‘THE GUARDIAN’ (UK)

The shocking jobs data from the US yesterday should remove the last doubt about the potential of the current crisis to turn into the most serious economic shock to the global economy since the 1930s.

The fact that the world’s biggest economy shed 533,000 jobs last month smacks of a slump. While it is unlikely to prove as long and as deep as the Great Depression, more jobs were lost last month than at any time since 1974, when the decision by Opec to turn off the oil taps brought the postwar boom to a shuddering halt.

To make matters worse, the jobless figures for September and October were revised sharply higher so that payrolls were down by 1.25 million over the latest quarter.

Some analysts saw hope in the fact that the unemployment rate rose only modestly from 6.5% to 6.7%. But that was because more than 400,000 people left the labour force altogether last month, presumably on the grounds that there was no prospect of finding work.

Nor was this a temporary shakeout precipitated by the collapse of Lehman Brothers. Revisions to the back data show payrolls were down by more than 400,000 in September, before the escalation in the financial crisis had any effect.

Apart from any impact on shares, bonds and the dollar, yesterday’s woeful jobs data will have three consequences. If 1.25 million people suddenly stop earning a wage, there will be an impact on consumer spending. And if consumers are not spending, companies are not going to invest – even assuming that they can get the finance. We are likely to see output contract at an annual rate of about 4% in the fourth quarter – and it could be even worse. And what happens to America matters to everybody else, especially the big exporting nations: China, Germany, South Korea, Japan.

The second effect will be social. America does not have the generous welfare nets enjoyed in Europe, so unless those made jobless can quickly find work, there will be hardship, poverty and the threat of disorder.

The need to put people back to work leads to the third consequence. There will be further interest rate cuts by the Federal Reserve and other “unconventional” measures to drive down long-term rates. There will be suggestions that America can’t wait for the $500bn fiscal stimulus the president-elect is planning. And there will be help for the motor industry. One of the few Americans likely to have found hope in yesterday’s report will be Rick Wagoner, the boss of General Motors.

CLICK HERE FOR THE ORIGINAL ARTICLE

PUBLISHED BY ‘THE GUARDIAN’ (UK)

Posted in AUTOMOTIVE INDUSTRY, BANKING SYSTEM - USA, BANKRUPTCIES - USA, CENTRAL BANKS, CHINA, COMMERCE, CONSUMERS AND PSYCHOLOGICAL FACTORS, ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, EUROPE, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FOREIGN POLICIES, GERMANY, INDUSTRIAL PRODUCTION - USA, INDUSTRIES - USA, INTERNATIONAL RELATIONS, JAPAN, MACROECONOMY, NATIONAL WORK FORCES, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, SOUTH KOREA, STOCK MARKETS, THE EUROPEAN UNION, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, THE WORK MARKET, THE WORKERS, USA | Leave a Comment »

SHARING THE RESPONSABILITY

Posted by Gilmour Poincaree on December 7, 2008

DECEMBER 3-8, 2008

by Michael Levitin

PUBLISHED BY ‘NEWSWEEK’ – Print Edition – (USA)

He was Chief of Staff to Chancellor Gerhard Schröder, the leading voice behind 'A BIGGER BREAK' - Frank-Walter Steinmeier says the crisis forced the U.S. to leave behind its traditions - Photo by Hans-Christian Plambeck (Laif-Redux)Germany’s refusal to fight in Iraq. Now German Foreign Minister Frank-Walter Steinmeier is the Social Democratic Party candidate for chancellor in next year’s elections, running against the popular Christian Democrat incumbent, Angela Merkel. In his first major interview with the U.S. press, Steinmeier sat down with NEWSWEEK’s Michael Levitin to discuss German troop engagements in Afghanistan, Russia’s recent aggression, the global financial crisis and how Germany might work alongside the United States. Excerpts:

LEVITIN: The day after Barack Obama won the U.S. presidency, Russian President Dmitry Medvedev threatened to install missiles in Kaliningrad if Washington did not “rethink” its deployment of a NATO missile shield in Eastern Europe. Did Moscow’s latest show of aggression shift the dynamic between Russia and Europe? How should you respond- and what should Europe’s response be?

STEINMEIER: Medvedevs announcement the day after the elections was clearly the wrong signal at the wrong time. We have no illusions about Russia. In the last few years it has often proved itself a difficult partner. The question remains how to deal with this huge country in Europe’s immediate neighborhood; having to choose between containment versus engagement, I advocate the latter. We must try to develop relations with Russia that go beyond economic interests and contribute to increased stability and security. After all, it is in our own interest to make sure that a Russia that is looking for its own identity is politically and culturally anchored in die West.

LEVITIN: Do you see Germany as a middleman, acting as a buffer between Russia and the rest of Europe-perhaps at the moment even Russia’s closest EU ally?

STEINMEIER: Russia is aware of our uniquely close relationship with the United States. We are firmly embedded in NATO and the EU and thus we don’t aspire to play the role of a middleman. Together with our European partners we showed a strong and outspoken response to Russia’s role in the conflict in Georgia. I think Europe’s united voice no doubt contributed to the military conflict ending. Now the stabilization of the region as a whole has to continue, and for genuine stability we need Russian cooperation. As for energy links between the EU and Russia, the answer depends on which European country you talk to. But in general, Russia depends as much on Europe and America buying its goods as we rely on Russia supplying us with natural gas and oil. As far as Germany is concerned, it is little known in the United States that we have worked successfully for decades to diversify our suppliers of various forms of energy and fuels, with Russia but also Norway and Africa being important suppliers.

LEVITIN: You mentioned the conflict In Georgia. Should that country and Ukraine be Invited to Join NATO?

STEINMEIER: This is not a simple yes-or-no decision. With national elections looming, the domestic situation in Ukraine has changed, as has the situation in the Caucasus since the conflict broke out this summer. Yes, we remain committed to supporting and assisting these countries on the road ahead. But concerning the Membership Action Plan, Germany and other European governments continue to stand by their position.

LEVITIN: The most urgent U.S. foreign-policy question involving Germany, which Obama raised many times during his campaign, is Afghanistan and whether Germany will contribute more troops there to stabilize the south. How much is your country willing to sacrifice for this partnership, putting its soldiers into harm’s way?

STEINMEIER: I have spoken to Barack Obama twice, and from these exchanges I know that he sees Afghanistan in a very nuanced way. I feel we see eye to eye in our assessment that we’re facing a very difficult security situation, but that military means alone cannot bring about the necessary changes. Our approach has to be a comprehensive one, and contrary to what some people may say, Germany has played its part.

LEVITIN: In the north, certainly. But It’s in the south where the greatest violence has taken place, and where Obama’s asking for greater German participation.

STEINMEIER: We have shouldered our share of the military responsibility and we have also enlarged our engagement. We are about to increase our troops by 30 percent, to 4,500. We are participating in aerial surveillance across the whole of Afghanistan, including the south, and German radio engineers are also stationed in Kandahar. The German Air Force runs flights for all NATO countries throughout Afghanistan, again including the south. We took over the lead of the Quick Reaction Force in the north. And let us not forget that circumstances there have also changed; the north, too, has seen its share of armed opposition activities increasing in the last month. But our engagement in Afghanistan is about much more than military action. We have always said that we will only be successful if we succeed in helping rebuild the country and its economy. Civil reconstruction is the second important pillar of our engagement on the ground, and we’ll continue to increase our contribution in this area next year.

LEVITIN: Given the turmoil in Pakistan, what do you think the next steps forward ought to be?

STEINMEIER: The security of the whole region strongly depends on Pakistan. If we want to combat terrorism in Afghanistan, we have to succeed in stabilizing Pakistan politically and economically. This calls for a strengthened Pakistani commitment to combat terrorism, but it also calls for international assistance for this country. It needs a substantial loan from the IMF. We also need to be ready to help stabilize the country in a lasting way.

LEVITIN: On Iran, what realistic hopes do you see of bringing Mahmoud Ahmadinejad to the table and persuading him to give up Tehran’s nuclear ambitions? And how far will you be willing to push?

STEINMEIER: No doubt there is hope in the international community that after 29 years of standstill, a new approach may be possible. We all remember the reasons for the break-off of relations between the U.S. and Iran. Since then, U.S.-Iranian relations have also been a story of missed opportunities: when Washington signaled openness, Tehran wasn’t willing or able to respond in kind, and vice versa. I think it would be worthwhile trying to have direct talks, but the Iranians have to know it is up to them to prove they do not aspire to nuclear weapons-and that they’re willing to play a constructive role in the region. I have to admit I am skeptical, and can only express my hope that the leaders in Iran seize this opportunity.

LEVITIN: Turning to the financial crisis, the banks got a bailout. Now the automobile manufacturers are seeking the same thing. How do you see EU countries regaining their competition policy-and their legitimacy-after this?

STEINMEIER: I believe the politicians would have lost their legitimacy if they hadn’t acted. What we’re facing here is the very visible failure of the market. We had to make sure that the crisis in the financial markets does not lead to a total breakdown of the financial system as a whole. On both sides of the Atlantic, unconventional means were applied to manage the crisis. Honestly speaking, many of the measures taken in the U.S. seemed a bigger break with American tradition than can be said about European measures.

LEVITIN: How important is it that developing countries play a greater decision-making role In the future? For example, we saw hints of the G8 expanding into a G20 several weeks ago in Washington.

STEINMEIER: What is the most fundamental challenge the world is facing today? To my mind, it consists of integrating the emerging powers of the 21st century into a system of shared global responsibility. I am talk ing about countries like China and India, but also Muslim states such as Saudi Arabia. Can any of the global challenges we face be tackled without them? I don’t think so. That is why we have to make them stakeholders, and in that respect the recent financial summit in Washington was historic. To me it is obvious we cannot stop there.

PUBLISHED BY ‘NEWSWEEK’ (USA)

Posted in 'DOHA TALKS', AFGHANISTAN, AFRICA, BARACK HUSSEIN OBAMA -(DEC. 2008/JAN. 2009), CHINA, COMMERCE, COMMODITIES MARKET, DEFENCE TREATIES, ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, ENERGY, ENERGY INDUSTRIES, EUROPE, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, FOREIGN POLICIES, FOREIGN POLICIES - USA, G20, G8, GEORGIA, GERMANY, INDIA, INDUSTRIAL PRODUCTION, INDUSTRIAL PRODUCTION - USA, INDUSTRIES, INDUSTRIES - USA, INTERNATIONAL, INTERNATIONAL RELATIONS, IRAN, ISLAM, MILITARY CONTRACTS, NATO, NATURAL GAS, NORWAY, PAKISTAN, PETROL, RECESSION, RUSSIA, SAUDI ARABIA, THE ARMS INDUSTRY, THE EUROPEAN UNION, THE FLOW OF INVESTMENTS, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, THE OCCUPATION WAR IN IRAQ, THE UNITED NATIONS, USA, WAR IN AFGHANISTAN, WARS AND ARMED CONFLICTS | 1 Comment »

NEW GAS EXPORT STRATEGIES (Iran)

Posted by Gilmour Poincaree on December 3, 2008

Thu, Dec 04, 2008

by Majid Karimi

PUBLISHED BY ‘THE IRAN DAILY’

The trilateral meeting between the leaders of Turkmenistan, Turkey and the Republic of Azerbaijan was held at It is difficult to predict the final stance of Turkmenistan toward the Nabucco pipeline, as nothing official has yet been made public.Turkmanbashi, Turkmenistan, on Friday.

Gurbanguly Berdymuhammedov, Abdullah Gul and Elham Aliev respectively discussed cooperation in the field of energy.

The meeting followed Berdymuhammedov’s visit to Germany and Austria, and negotiations for exporting gas to Europe. Of course, he has not made explicit comments regarding exports of gas to Europe via Nabucco or the trans-Caspian project.

The trans-Caspian project has not yet materialized due to ambiguities surrounding the Caspian legal regime, rift between Turkmenistan and Azerbaijan over a gas field and environmental problems.

Diversification

After the Turkmanbashi meeting, Financial Times reported Azerbaijan and Turkmenistan have reached an agreement about new strategies for exporting the Caspian Sea energy to consumer markets to curb the dependency of European states on Russian gas.

Based on this report, the European Union (EU) and the US have urged Turkmenistan to join the Nabucco pipeline project for transporting gas via Azerbaijan, Georgia and Turkey.

After meeting his Azeri counterpart, Berdymuhammedov said, “Turkmenistan and Azerbaijan, which are rich in hydrocarbon resources, have reached an agreement on diversifying the export routes for energy to the global markets.“

He emphasized that his country is keen on participating in the Nabucco pipeline project, but is under pressure for exporting its gas via Russia, which is the main market for Turkmen gas.

“Turkmenistan has signed a contract for supplying gas to China via the pipeline which is presently under construction,“ he said.

On the threshold of this trilateral meeting, Berdymuhammedov visited Germany and Austria during Nov. 13-19. In these visits, issues pertaining to the transport of Caspian Sea gas bypassing Russia were examined.

Manager of Azerbaijan’s Oil Projects Research Center Ilham Shaban noted that negotiations between the presidents of Azerbaijan, Turkey and Turkmenistan hints at more extensive cooperation among them in the energy sector than the Nabucco project alone.

Future meetings are not expected to focus on the gas project for building a pipeline through the Caspian seabed because at the presidential level, projects in their preliminary stages are not examined.

“So far, a few meetings have been held between representatives of Turkey and Turkmenistan in which the import of electricity and transport of gas via Iran were discussed. But, the last case did not materialize,“ he said.

The Azeri official noted that till now, no trilateral meeting was held between the leaders of Azerbaijan, Turkmenistan and Turkey.

“I should mention a similar case regarding how things proceeded regarding energy cooperation between Azerbaijan and Kazakhstan. Since November 2002, negotiations took place between Baku and Astaneh at different levels. This eventually led to an intergovernmental agreement between Azerbaijan and Kazakhstan regarding oil transport via the Baku-Tbilisi-Ceyhan pipeline. Hence, the meeting in Turkmenistan is another step to this end,“ he said.

Since the Commonwealth of Independent States gained their independence in 1991, Azerbaijan has had good economic ties with Turkmenistan and Turkey.

“I personally believe that in future negotiations between the presidents of these countries, more issues will be examined,“ he said.

Shaban further said it is difficult to predict the final stance of Turkmenistan toward the Nabucco pipeline, as nothing official has yet been made public, except a communiquŽ expressing Turkmenistan’s desire to diversify its gas supply.

“Interestingly enough, it has been mentioned that gas will be transported to China from fields located above Amudarya, from northern Dolatabad to Russia via the pipeline alongside the Caspian Sea and whatever is found in the western part of Turkmenistan will be transported to the West,“ he said.

It seems that Turkmenistan has determined, after 17 years of independence, where and how gas should be transported in a viable manner.

CLICK HERE FOR THE ORIGINAL ARTICLE

PUBLISHED BY ‘THE IRAN DAILY’

Posted in CENTRAL BANKS, CHINA, COMMERCE, COMMODITIES MARKET, COMMONWEALTH OF INDEPENDENT STATES, ECONOMIC CONJUNCTURE, ECONOMY, ENERGY, ENERGY INDUSTRIES, EUROPE, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FOREIGN POLICIES, GERMANY, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, INTERNATIONAL RELATIONS, IRAN, KAZAKHSTAN, NATURAL GAS, REGULATIONS AND BUSINESS TRANSPARENCY, RUSSIA, THE FLOW OF INVESTMENTS, TURKEY, TURKMENISTAN, UZBEKISTAN | Leave a Comment »

ECONOMIC STIMULUS PLANS SPRING UP AROUND WORLD

Posted by Gilmour Poincaree on December 3, 2008

Published Tuesday, December 2, 2008

THE WASHINGTON POST

PUBLISHED BY ‘THE OMAHA WORLD-HERALD’ (USA)

WASHINGTON — In a bid to jump-start the beleaguered global economy, countries around the world are introducing massive public spending programs aimed at creating millions of jobs, boosting the use of green energy and modernizing infrastructure in a way that could transform urban and rural landscapes.

The viability of some of the plans remains unclear. But observers say the number of countries moving in tandem underscores the perceived severity of the coming global recession and the view that governments must at least temporarily pick up the slack as the hard-hit private sector sheds jobs and cuts spending.

It is time “to invest massively in infrastructure, in research, in innovation, in education, in training people, because it is now or never,” French President Nicolas Sarkozy said in a recent public address.

World leaders are pursuing various strategies to tame the economic crisis, including moves to unclog credit markets, strengthen financial institutions and ease monetary policy. But fiscal stimulus packages, in particular, have emerged as a favorite tool of policymakers.

Worldwide, economists say, the increase in public spending, if executed wisely, could add as much as 1 percent or 2 percent to global growth next year, perhaps easing recessions in the United States, Europe and Japan while cushioning the slowdown in the developing world, which until recently had seen red-hot growth.

Yet if the promise of combating a global recession with public funds is big, so too, experts say, is the danger that billions worth of taxpayers dollars could be spent in vain.

Analysts point out that the pitfalls of growth-by-spending were exposed by Japan, which launched a huge infrastructure program in the 1990s. To spur expansion after stock market and real estate crashes, the Tokyo government spent billions on new public works projects.

Those projects not only failed to prevent a decadelong economic slump but also produced a herd of white elephants that included new, but little-used, airports and ports, as well as a $250 million bridge to Kourijima Island. Population: 361.

“There is a huge danger of bridges to nowhere, and as Japan showed us, that is no way to get out of a recession,” said Grant Aldonas, a former high-level Bush administration trade official and a senior fellow at the Center for Strategic and International Studies.

While China and Japan enjoy a surplus of reserves, spending increases will drive the United States, Britain and many other European countries deeper into debt. The cost of raising cash on world markets by some rich nations, such as Ireland, has surged as investors grow increasingly skeptical of their fiscal health, limiting their options to spend more now.

“In normal times, we would be telling countries, ‘Please reduce your debt,'” said Olivier Blanchard, chief economist at the International Monetary Fund, which has taken the unusual step of calling on nations to raise public spending by 2 percent of gross domestic product to combat a global recession. “But these are not normal times.”

A snapshot of how governments plan to increase spending is emerging. Those plans include not only the building of more bridges and roads but also the introduction of measures to put more cash into the hands of strapped consumers.

In the United States, the Federal Reserve and Treasury Department have moved to boost consumer spending and lower home mortgage rates, committing as much as $800 billion to make it easier for Americans to borrow money for cars, tuition and homes.

The British said they would slash the national sales tax from to 15 percent from 17.5 percent. The Germans are set to offer temporary tax incentives to consumers buying cars or renovating homes. The Japanese are giving out cash rebates to taxpayers.

Some of the projects being proposed are pre-existing infrastructure plans that are being accelerated. Nicholas Lardy, a senior fellow at the Peterson Institute for International Economics, estimates that only about half the “new projects” in Beijing’s $586 billion package amount to previously unplanned spending. “But that is still a great deal of money,” Lardy said.

A number of countries are gearing up for projects that offer long-term benefits, both economic and environmental.

In a move that may offer a guide to helping the ailing Big Three automakers in Detroit, the French are in the early stages of plans to assist their hard-hit auto industry by awarding government grants to boost research into hybrid and battery-power technology.

In comments last week, president-elect Barack Obama suggested that an expansion of wind and solar power generation would be part of his stimulus plans. Obama also cited a plan being circulated by environmental groups that would offer government loans to help schools update their heating and cooling systems, creating quick construction jobs and stimulating demand for building materials.

“I think the fervor in which (the Obama team) is seeking suggestions right now tells me that this kind of spending is something they are very serious about,” said Carl Pope, executive director the Sierra Club.

Some countries in Europe, such as Germany, appear more concerned about overspending. That is at odds with the leadership in France, where Sarkozy has seen the crisis as an opportunity to boost the role of government.

CLICK HERE FOR THE ORIGINAL ARTICLE

PUBLISHED BY ‘THE OMAHA WORLD-HERALD’ (USA)

Posted in BANKING SYSTEM - USA, BANKING SYSTEMS, BARACK HUSSEIN OBAMA -(DEC. 2008/JAN. 2009), BIOFUELS, CENTRAL BANKS, CHINA, COMMERCE, ECONOMIC CONJUNCTURE, ECONOMY, ECONOMY - USA, ENERGY, ENERGY INDUSTRIES, EUROPE, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FRANCE, GERMANY, HOUSING CRISIS - USA, IMF, INDUSTRIAL PRODUCTION, INDUSTRIAL PRODUCTION - USA, INDUSTRIES, INTERNATIONAL, JAPAN, MACROECONOMY, MARITIME, NATIONAL WORK FORCES, RAILWAY TRANSPORT, RECESSION, ROAD TRANSPORT, SOLAR, THE FLOW OF INVESTMENTS, THE LAST DAYS OF GEORGE WALKER BUSH - 2008/Jan. 2009, THE WORK MARKET, THE WORKERS, UNITED KINGDOM, USA | Leave a Comment »

“AMERICA FIRST”

Posted by Gilmour Poincaree on December 1, 2008

PUBLISHED BY TIME CAPSULE/1940 – Times Magazine (1968)

PAGE 23

Last CARTOON BY DR. SEUSSJune, a Yale law student named Robert Douglas Stuart Jr. deplored Yale University President Charles Seymour’s espousal of open aid to the Allies, believing it would lead the U.S. into war. Furthermore, he thought Seymour’s views were not those of the student body and got up a poll showing 3-to-l on his side. General Robert E. Wood (chairman of Sears, Roebuck) heard of the Yale-man’s activities, asked Stuart to visit him. Out of their conversation grew the America First Committee.

Last week General Wood’s committee had 60,000 members, eleven local chapters and an organization drive that was going like a house afire. In Washington, national committee members included such strange company as socially conscientious Kathryn Lewis (daughter of John L.) and socially conspicuous Alice Roosevelt Longworth. Just what the organization was after remained obscure: it was easier to see what it was against. And what the committee was against was getting the U.S. into the war. General Wood last week adduced some further arguments to the National Association of Manufacturers’ meeting in Manhattan:

1) Germany cannot invade America even if Britain falls.

2) The U.S. can and will do business with the Nazis even if necessary to cartelize the trade.

3) If the U.S. convoys British shipping, that act “is sure to put us in the conflict.”

Posted in FOREIGN POLICIES - USA, FREEDOM OF SPEECH AND CONSCIENCE, GERMANY, HISTORY, HUMAN RIGHTS, INTERNATIONAL, INTERNATIONAL RELATIONS, THE MEDIA (US AND FOREIGN), USA, USA HUMOR, WARS AND ARMED CONFLICTS | Leave a Comment »

THE WEIMAR CHRONICLE – Chapter 6

Posted by Gilmour Poincaree on November 30, 2008

by Alex de Jonge

INFLATION

The year 1923 has a special and dreadful connotation in German history, for it was the year of the great inflation. If defeat, abdication and revolution had begun to undermine the traditional values of German culture, then the inflation finished the process so completely that in the end there were no such values left. By November 1918 there were 184.8 marks to the pound. By late November 1923 there were 18,000,000,000,000. Although the mark was eventually "restored," and the period of inflation succeeded by a time of relative prosperity for many people, life for anyone who had lived through the lunatic year of 1923 could never be the same again.

Such a cataclysmic loss of a currency’s value can never be ascribed to a single cause. Once confidence goes, the process of decline is a self-feeding one. By late 1923 no one would hold German money one moment longer than it was really necessary. It was essential to convert it into something, some object, within minutes of receiving it, if one were not to see it lose all value in a world in which prices were being marked up by 20 percent every day.

If we go back beyond the immediate cause of hyperinflation—beyond a total lack of confidence in a currency that would consequently never "find its floor," however undervalued it might appear—we find that passive resistance in the Ruhr was a major factor. Effective loss of the entire Ruhr output weakened the mark disastrously, encouraging dealers to speculate against it, since the balance of payments was bound to show a vast deficit. Confidence in the currency could only begin to be restored when resistance ended late in 1923.

It has been the "patriotic" view that reparations were also a significant factor. Certainly they constituted a steady drain upon the nation’s resources, a drain for which it got no return. But reparations alone would not have brought about hyperinflation. There were still other causes. Sefton Delmer believes that the true explanation lay in Germany’s financing of the war. She had done so very largely on credit, and was thereafter obliged to run a gigantic deficit. There were other more immediate causes, such as a total incomprehension of the situation on the part of Havenstein, director of the Reichsbank. Failing to understand why the currency was falling, he was content to blame it upon forces beyond his control—reparations—and attempted to deal with the situation by stepping up the money supply!

The first British ambassador to the Weimar Republic, Lord d’Abernon, had no illusions about the economic plight of Germany. He observed in his diary that "German finance is dying beyond its means," 1 and no one seemed to know why. In the meantime, he noted:

Currency experts have a sad fate. During life they empty every room in which they hold forth, and death finds them in madhouses. Berlin has been deluged with these gentlemen for the last week and still survives; but the currency has gone to the devil.2

He saw the Reichsbank compounding its own mistakes:

In the whole course of history, no dog has run after its own tail with the speed of the Reichsbank. The discredit they throw on their own notes increases even faster than the volume of the notes in circulation. The effect is greater than the cause; the tail goes faster than the dog.3

By October 1923 it cost more to print a note than the note was worth. Nevertheless Havenstein mobilized all the printing resources that he could. Some of the presses of the Ullstein newspaper and publishing group were even commandeered by the mint and turned to the printing of money. Havenstein made regular announcements to the Reichstag to the effect that all was well since print capacity was increasing. By August 1923 he was able to print in a day a sum equivalent to two-thirds of the money in circulation. Needless to say, as an anti-inflationary policy, his measures failed.

In his documentary novel Success, Leon Feuchtwanger has suggested that inflation had less obvious and more sinister causes. Certainly it had its beneficiaries as well as its victims. Anyone living on a pension or on fixed-interest investments—the small and cautious investor—was wiped out. Savings disappeared overnight. Pensions, annuities, government stocks, debentures, the usual investments of a careful middle class, lost all value. In the meantime big business, and export business in particular, prospered. It was so easy to get a bank loan, use it to acquire assets, and repay the loan a few months later for a tiny proportion of the original. Factory owners and agriculturalists who had issued loan stock or raised gold mortgages on their properties saw themselves released from those obligations in the same way, paying them off with worthless currency on the principle that "mark equals mark." It would be rash to suggest, as Feuchtwanger hints, that the occupation of the Ruhr was planned by industrialists to create an inflation which could only be to their benefit. Yet we should remember that Stinnes, the multi-millionaire, had both predicted that occupation and ended up the owner of more than 1,500 enterprises. It should also be remembered that some businessmen had a distinctly strange view of the shareholder. He was regarded by many as a burdensome nuisance, a drag upon their enterprise. He was the enemy and they were quite happy to see him wiped out to their benefit. Inflation was their chance to smash him. Witness the behavior of a banker at a shareholders’ meeting at which it was suggested he should make a greater distribution of profit: "Why should I throw away my good money for the benefit of people whom I do not know?"4

The ingenious businessman had many ways of turning inflation to good account. Thus employees had to pay income tax weekly. Employers paid their tax yearly upon profits which were almost impossible to assess. They would exploit the situation of a smaller businessman, obliged to offer six to eight weeks of credit to keep his customers, by insisting on payment in cash. The delay between paying for the goods and reselling them eroded any profit the small man might make, while the big supplier prospered.5

Whether or not the industrialists actually caused inflation, their visible prosperity made them detested by an otherwise impoverished nation. Hugo Stinnes became an almost legendary embodiment of speculation and evil. Alec Swan remembers how hungry Germans would stare at prosperous fellow countrymen in fur coats, sullenly muttering "Fabrikbesitzer" (factory owner) at them. The term had become an insult and an expression of envy at one and the same time.

Hyperinflation created social chaos on an extraordinary scale. As soon as one was paid, one rushed off to the shops and bought absolutely anything in exchange for paper about to become worthless. If a woman had the misfortune to have a husband working away from home and sending money through the post, the money was virtually without value by the time it arrived. Workers were paid once, then twice, then five times a week with an ever-depreciating currency. By November 1923 real wages were down 25 percent compared with 1913, and envelopes were not big enough to accommodate all the stamps needed to mail them; the excess stamps were stuck to separate sheets affixed to the letter.6 Normal commercial transactions became virtually impossible. One luckless author received a sizable advance on a work only to find that within a week it was just enough to pay the postage on the manuscript. 7 By late 1923 it was not unusual to find 100,000 mark notes in the gutter, tossed there by contemptuous beggars at a time when $50 could buy a row of houses in Berlin’s smartest street.8

A Berlin couple who were about to celebrate their golden wedding received an official letter advising them that the mayor, in accordance with Prussian custom, would call and present them with a donation of money.

Next morning the mayor, accompanied by several aldermen in picturesque robes, arrived at the aged couple’s house, and solemnly handed over in the name of the Prussian State 1,000,000,000,000 marks or one halfpenny.9

The banks were flourishing, however. They found it necessary to build annexes and would regularly advertise for more staff, especially bookkeepers "good with zeros." Alec Swan knew a girl who worked in a bank in Bonn. She told him that it eventually became impossible to count out the enormous numbers of notes required for a "modest" withdrawal, and the banks had to reconcile themselves to issuing banknotes by their weight.

By the autumn of 1923 the currency had virtually broken down. Cities and even individual businesses would print their own notes, secured by food stocks, or even the objects the money was printed on. Notes were issued on leather, porcelain, even lace, with the idea that the object itself was guarantee of the value of the "coin."10 It was a view of the relationship between monetary and real value that took one back five hundred years. Germany had become a barter society; the Middle Ages had returned. Shoe factories would pay their workers in bonds for shoes, which were negotiable. Theaters carried signs advertising the cheapest seats for two eggs, the most expensive for a few ounces of butter which was the most negotiable of all commodities. It was so precious that the very rich, such as Stinnes, used to take a traveling butter dish with them when they put up at Berlin’s smartest hotel.11 A pound of butter attained "fantastic value." It could purchase a pair of boots, trousers made to measure, a portrait, a semester’s schooling, or even love. A young girl stayed out late one night while her parents waited up anxiously. When she came in at four in the morning, her mother prevented her father from taking a strap to her by showing him the pound of butter that she had "earned."12 Boots were also highly negotiable: "The immense paper value of a pair of boots renders it hazardous for the traveler to leave them outside the door of his bedroom at his hotel.". 13

Thieves grew more enterprising still in their search for a hedge against inflation.

Even the mailboxes are plundered for the sake of the stamps attached to the letters. Door handles and metal facings are torn from doors; telephone and telegraph wires are stolen wholesale and the lead removed from roofs.14

In Berlin all metal statues were removed from public places because they constituted too great a temptation to an ever-increasing number of thieves. One of the consequences of the soaring crime rate was a shortage of prison accommodation. Criminals given short sentences were released and told to reapply for admission in due course.15

It was always possible that one might discover an unexpected source of wealth. A Munich newspaperman was going through his attic when he came upon a set of partly gold dentures, once the property of his grandmother, long since dead. He was able to live royally upon the proceeds of the sale for several weeks.16

The period threw up other anomalies. Rents on old houses were fixed by law, while those on new ones were exorbitantly high. As a result in many parts of Germany housing was literally rationed. If one were fortunate enough to live in old rented property, one lived virtually free. The landlord, however, suffered dreadfully: to repair a window might cost him the equivalent of a whole month’s rent. Thus yet another of the traditional modes of safe investment, renting property, proved a disaster. Hitherto well-to-do middle-class families found it necessary to take in lodgers to make ends meet. The practice was so widespread that not to do so attracted unfavorable attention suggesting that one was a profiteer. Pearl S. Buck records the case of one family where the woman of the house reluctantly confessed to her husband that they would have to have a lodger. He greeted the news not with anger, but with a sigh of relief: the neighbors had begun to talk. Real property lost its value like everything else. Pearl Buck notes the case of a couple selling their house in order to marry their daughter in some kind of style. More telling is a famous song of inflation:

We are drinking away our grandma’s

Little capital

And her first and second mortgage too.17

As noted in the famous and highly intelligent paper the Weltbühne, the song picked out the difference between the "old" generation of grandparents who had scraped and saved carefully in order to acquire the security of a house, and the "new generation" for whom there could be no security any more, who "raided capital" or what was left of it, and were prepared to go to any lengths to enjoy themselves. Where their parents’ lives had been structured with certainties, the only certainty that they possessed was that saving was a form of madness.

Not all Germans suffered, of course. Late in 1923 Hugo Stinnes did what he could to alleviate the misery of his fellow countrymen by the magnanimous decision to double his tipping rate in view of the inflation.18 Along with rents, rail fares were also fixed and did not go up in proportion to inflation. Consequently, travel appeared absurdly cheap. Alec Swan recalls crossing Germany in the greatest style for a handful of copper coins. Yet even this was beyond the means of most Germans. A German train in 1923 would consist of several first-class carriages occupied entirely by comfortable foreigners, and a series of run-down third-class carriages crammed to bursting with impoverished and wretched Germans.

Although the shops were full of food, no one could afford it except foreigners. Germans often had to be content with food not normally thought of as fit for human consumption. In Hamburg there were riots when it was discovered that the local canning factory was using cats and rats for its preserved meats. Sausage factories also made much use of cat and horse meat.19 Moreover, as we shall see, some of the most famous mass murderers of the age used to preserve and sell the meat of their victims in a combination of savagery and an almost sexual obsession with food that mythologizes much of the darkness and the violence that were latent in the mood of Weimar.

If 1923 was a bad year for the Germans it was an annus mirabilis for foreigners. Inflation restored the sinking morale of the army of occupation ; small wonder when every private found himself a rich man overnight. In Cologne an English girl took lessons from the prima donna of the opera for sixpence a lesson. When she insisted that in future she pay a shilling, the prima donna wept with delight.20 Shopping became a way of life: "All through that autumn and winter whenever we felt hipped we went out and bought something. It was a relaxation limited at home, unlimited in the Rhineland.". 21

Germany was suddenly infested with foreigners. It has been suggested that the English actually sent their unemployed out and put them up in hotels because it was cheaper than paying out the dole.22 Alec Swan stayed with his family in a pension in Bonn. They had moved to Germany because life was so much cheaper there. The inmates of Swan’s pension were mostly foreigners of strange complexion, such as the Swede suffering from tertiary syphilis who would bombard heads of state with urgent telegrams. There was also an extremely fat German, christened Glaxo by the Swans. He was in the habit of helping himself to gigantic mounds of the spaghetti which formed the staple diet of the common table, saying apologetically, "My stomach, my stomach," with a hand upon the offending organ, as a form of explanation.

To find oneself suddenly wealthy in the midst of tremendous hardship proved rather unsettling. Inflation corrupted foreigners almost as much as the Germans. The English in Cologne could think of nothing else.

They talked with sparkling eyes and a heightened color, in the banks, the streets, the shops, the restaurants, any public place, with Germans standing around gazing at them.

Scruples were on the whok overwhelmed by the sudden onslaught of wealth and purchasing power beyond one’s dreams.23

As Alec Swan put it:

You felt yourself superior to the others, and at the same time you realized that it was not quite justified. When we went to Bellingshausen, which was a sort of wine place near Königswinter, we would start drinking in the afternoon. I would always order champagne and my Dutch friend would shake his head in disapproval. We’d have two ice buckets: he with some Rhine wine and me with German champagne. It was really rather ridiculous for a chap of my age to drink champagne on his own.

Being as wealthy as that was an extraordinary feeling, although there were many things you couldn’t get in Germany. It was impossible to buy a decent hat, for instance. But you could have any food you wanted if you could pay for it. I haven’t eaten anything like as well as that in my life. I used to go to the Königshalle (that was the big café in Bonn) at eleven o’clock in the morning for a Frühschoppen and a Bergmann’s Stückchen, a large piece of toast with fresh shrimps and mayonnaise. For a German that would have been quite impossible.

I paid two million marks for a glass of beer. You changed as little money as you could every day. No, one did not feel guilty, one felt it was perfectly normal, a gift from the gods. Of course there was hatred in the air, and I dare say a lot of resentment against foreigners, but we never noticed it. They were still beaten, you see, a bit under and occupied.

My mother did buy meat for three or four German families. I remember I bought an air gun, and, when I grew tired of it, I gave it to my German teacher’s son, with some pellets. Some time later the woman came to me in tears saying the boy had run out of pellets, and they could not afford to buy any more.

On another occasion Swan, all of twenty-two at the time, took the head of the Leipzig book fair out for a meal and looked on incredulously as the elderly and eminent bookseller cast dignity to the winds and started to eat as if he had not had a meal in months.

Stories of money changing and currency speculation are legion. Bureaux de change were to be found in every shop, apartment block, hairdresser’s, tobacconist’s. An Englishman named Sandford Griffith remembers having to visit a number of cities in the Ruhr which had local currencies. He stopped at a dealer’s to change some money, but when he produced a pound note the dealer was so overcome by such wealth that he simply waved a hand at his stock of currency and invited the astonished Englishman to help himself.24 Foreigners acquired antiques and objets de valeur at rock-bottom prices. A favorite trick was to buy in the morning with a down payment, saying that one would fetch the rest of the money from the bank. By waiting until the new exchange rate had come out at noon before changing one’s money into marks, an extra profit could be made on the amount that the mark had fallen since the day before.25

The population responded to the foreign onslaught with a double pricing system. Shops would make their prices up for foreigners. It would cost a tourist 200 marks to visit Potsdam, when it cost a German 25. Some shops simply declined to sell to foreigners at all.26 In Berlin a Schlemmsteuer, or tax on gluttony, was appended to all meals taken in luxury restaurants.27

Foreign embassies were also major beneficiaries of inflation, giving lavish banquets for virtually nothing. Indeed the Weltbühne noted with great resentment the presence of foreign legations of nations so insignificant that they would never hitherto have dreamed of being represented in Germany.28 The spectacle of foreigners of all nations, living grotesquely well and eating beyond their fill in the middle of an impoverished and starving Germany did not encourage the Germans to rally to the causes of pacificism and internationalism. The apparent reason for their inflation was there for all to see, occupying the Ruhr.

The surface manifestations of inflation were unnerving enough, but its effect upon behavior, values and morals were to reach very deep indeed, persisting for years after the stabilization of the mark, right up to the moment when Hitler came to power. The middle class—civil servants, professional men, academics—which had stood for stability, social respectability, cultural continuity, and constituted a conservative and restraining influence was wiped out. A French author met a threadbare and dignified old couple in spotless but well-worn prewar clothes in a cafe. They ordered two clear soups and one beer, eating as if they were famished. He struck up a conversation with the man, who spoke excellent French and had known Paris before the war. "Monsieur," the man replied, when asked his profession, "I used to be a retired professor, but we are beggars now.".29

There was a general feeling that an old and decent society was being destroyed. If the year 1918 had removed that society’s political traditions and its national pride, 1923 was disposing of its financial substructure. In response, people grew either listless or hysterical. A German woman told Pearl Buck that a whole generation simply lost its taste for life—a taste that would only be restored to them by the Nazis. Family bonds melted away. A friend of Swan, a most respectable German whose father was a civil servant on the railways, simply left home and roamed the country with a band. It was a typical 1923 case history. Young men born between 1900 and 1905 who had grown up expecting to inherit a place in the sun from their well-to-do parents suddenly found they had nothing. From imperial officer to bank clerk became a "normal" progression. Such disinherited young men naturally gravitated toward the illegal right-wing organizations and other extremist groups. Inflation had destroyed savings, self-assurance, a belief in the value of hard work, morality and sheer human decency. Young people felt that they had no prospects and no hope. All around them they could see nothing but worried faces. "When they are crying even a gay laughter seems impossible . . . and all around it was the same . . . quite different from the days of revolution when we had hoped things would be better.".30

Traditional middle-class morality disappeared overnight. People of good family co-habited and had illegitimate children. The impossibility of making a marriage economically secure apparently led to a disappearance of marriage itself.31 Germany in 1923 was a hundred years away from those stable middle-class values that Thomas Mann depicted in The Magic Mountain, set in a period scarcely ten years before. Pearl Buck wrote that "Love was old-fashioned, sex was modern. It was the Nazis who restored the ‘right to love’ in their propaganda.".32

Paradoxically, the inflation that destroyed traditional German values was also largely responsible for the creation of that new, decadent and dissolute generation that put Berlin on the cosmopolitan pleasure seeker’s map, and has kept it or its image there ever since. It was no coincidence that 1923 was the year that the Hotel Adlon first hired gigolos, professional male dancers, to entertain lady clients at so much per dance. It was also a period when prostitution boomed. A Frenchman accustomed enough to the spectacle of Montmartre was unable to believe his eyes when he beheld the open corruption of Berlin’s Friedrichstrasse.33 Klaus Mann remembers:

Some of them looked like fierce Amazons strutting in high boots made of green glossy leather. One of them brandished a supple cane and leered at me as I passed by. "Good evening, madame" I said. She whispered in my ear: "Want to be my slave? Costs only six billion and a cigarette. A bargain. Come along, honey.".

. . . Some of those who looked most handsome and elegant were actually boys in disguise. It seemed incredible considering the sovereign grace with which they displayed their saucy coats and hats. I wondered if they might be wearing little silks under their exquisite gowns; must look funny I thought … a boy’s body with pink lace-trimmed skirt.34

Commercial sex in Berlin was not well organized and was considered by connoisseurs to be inferior to that of Budapest, which had the best red-light district in Europe. But in Berlin there was no longer any clear-cut distinction between the red-light district and the rest of town, between professional and amateur. The booted Amazons were streetwalkers who jostled for business in competition with school children. Hans Fallada has painted the following portrait of a shop girl:

Pepa Ledig was at twenty-two no longer a blank page. She had ripened, not in a peaceful atmosphere, but during the war, postwar and inflation. Only too soon she knew what it meant when a gentleman customer in her bootshop touched her lap significantly with his toe. Sometimes she nodded . . . 35

Stefan Zweig gives us another glimpse of inflationary Berlin:

Along the entire Kurfürstendamm powdered and rouged young men sauntered, and they were not all professionals; every schoolboy wanted to earn some money, and in the dimly lit bars one might see government officials and men of the world of finance tenderly courting drunken sailors without shame. . . .

At the pervert balls of Berlin, hundreds of men dressed as women, and hundreds of women as men danced under the benevolent eyes of the police…. Young girls bragged proudly of their perversion. To be sixteen and still under suspicion of virginity would have been considered a disgrace in any school in Berlin at the time.36

Another visitor was struck by what he referred to as Berlin’s "pathological" mood:

Nowhere in Europe was the disease of sex so violent as in Germany. A sense of decency and hypocrisy made the rest of Europe suppress or hide its more uncommon manifestations. But the Germans, with their vitality and their lack of a sense of form, let their emotions run riot. Sex was one of the few pleasures left to them. . . .

In the East End of Berlin there was a large Diele (dancing cafe) in which from 9 p.m. to 1 a.m. you could watch shopkeepers, clerks and policemen of mature age dance together. They treated one another with an affectionate mateyness; the evening brought them their only recreation among congenial people. Politically most of them were conservative; with the exception of sex they subscribed to all the conventions of their caste. In fact, they almost represented the normal element of German sex life.

… There was a well-known Diele frequented almost entirely by foreigners of both sexes. The entertainment was provided by native boys between 14 and 18. Often a boy. would depart with one of the guests and return alone a couple of hours later. Most of the boys looked undernourished…. Many of them had to spend the rest of the night in a railway station, a public park, or under the arch of a bridge.37

Inflation made Germany break with her past by wiping out the local equivalent of the Forsytes. It also reinforced the postwar generation’s appetite for invention, innovation and compulsive pleasure seeking, while making them bitterly aware of their own rootlessness. It is not surprising that cocaine was very much in vogue in those years. The drug was peddled openly in restaurants by the hat-check girls, and formed an integral part of the social life of Berlin.

Inflation was also taken as evidence that the old order was morally and practically bankrupt. Capitalism had failed to guarantee the security of its citizens. It had benefited speculators, hustlers, con men and factory owners. It had spawned Hugo Stinnes, but had done nothing for the common good. The need for an alternative system appeared universally self-evident, and until one came along the thing to do was to enjoy oneself, drink away grandma’s capital, or exchange one’s clothes for cocaine: a dinner jacket got you four grams, a morning coat eight.38

Inflation and the despair that it created also acted as the catalyst of aggression. It was at this time that anti-Semitism began to appear in Berlin. An attractive German lady remembers walking through a prosperous suburb with a Jewish friend when someone called to her in the street, "Why do you go around with a Jew ? Get yourself a good German man." In one sense she found it understandable. The ordinary German was very slow to adjust to the special situation of inflation, and in 1923 anyone who was not very quick on their feet soon went under. Jews were better at economic survival in such situations than were other Germans—so much so, she says, that by the end of inflation they had become terribly conspicuous. All the expensive restaurants, all the best theater seats, appeared to be filled by Jews who had survived or even improved their position.

One can imagine that Germans who had lost their own status might have resented the spectacle. One old conservative I spoke to added a second reason for the rise of anti-Semitism in a Prussian society which had traditionally been quite free of it. The arguments advanced are his own, and tell us something of his prejudices. He believes that the Weimar Republic was too liberal with regard to immigration from the East, admitting thousands of Jews from Galicia and the old pale of settlement, persons who, in his words, were "Asiatics, not Jews." They found themselves in a strange anonymous town, free of all the ethical restraints imposed by life in a small community where their families had lived for several generations. They tended therefore to abandon all morality as they stepped out of their own homes, morality being strictly a family affair. They would sail as close to the wind as the law would allow, for they had no good will, or neighborly esteem to lose. The gentleman in question is convinced that their mode of doing business during the inflation did a great deal to create or aggravate more generalized anti-Semitic feelings.

Yet precisely these immigrants were to prove a mainstay of the republic. An old Berlin Jew who had spent some time in prewar Auschwitz told me that it was just these Eastern Jews who offered the most active and effective resistance to National Socialism. They were activists where native Berliners, Jew and Gentile alike, were more inclined to remain on the sidelines.

Certainly the period saw a rise in pro-National Socialist feelings. The first Nazi that Professor Reiff knew personally was a schoolboy in his last year. The young man’s father, a small civil servant, had just lost everything through inflation, and as a result his son joined the party. Pearl Buck records the views of an antimonarchical businessman worried by inflation, who said of the Nazis: "They are still young men and act foolishly, but they will grow up. If they will only drop Ludendorff and his kind, maybe someday I’ll give them a chance.".39

For many people, who felt that they had lost all zest for a life rendered colorless by war and poverty, who
could see that they lived in a world in which Schieber won and decent folk lost, a new ideology combining patriotism and socialist anticapitalism seemed to be the only viable alternative to a totally unacceptable state of financial chaos and capitalist laissez-faire. The shock of inflation had made people mistrustful of the past, immensely suspicious of the present, and pathetically ready to have hopes for the future. It was perfectly clear to them that new solutions were needed, equally clear that until such solutions should appear they could put their trust in nothing except the validity of their own sensations.

The mood of the inflationary period is summed up by Stefan Zweig. It is a mood that endured well beyond inflation itself to become the mood of the Weimar age, a blend of pleasure seeking, sexual and political extremism, and a yearning for strange gods.

It was an epoch of high ecstasy and ugly scheming, a singular mixture of unrest and fanaticism. Every extravagant idea that was not subject to regulation reaped a golden harvest: theosophy, occultism, yogism and Paracelcism. Anything that gave hope of newer and greater thrills, anything in the way of narcotics, morphine, cocaine, heroin found a tremendous market; on the stage incest and parricide, in politics communism and fascism constituted the most favored themes.40

It was indeed a time for the revaluation of all (devalued) values.

The mood of 1923 persisted long after inflation ended, which is why the manner of its ending is offered here as a postscript, for nothing was restored but the currency.

Restoration of confidence was only possible when passive resistance in the Ruhr ended in the autumn of 1923. At the same time, the Reichsbank appointed Hjalmar Schacht to deal with inflation. He was an extremely able man with a clear grasp of essentials. He realized that his main problem was to restore confidence both within and without Germany, and to try to prevent people from spending money as soon as it came into their hands. He established a new currency, based on the notional sum total of Germany’s agricultural wealth, the Roggen-Mark (rye mark). This had the effect of restoring psychological confidence in the currency. He combined the move with a gigantic bear trap laid by the Reichsbank to catch the speculators who would regularly build up huge short positions in marks, in the almost certain expectation that the mark would continue to fall against the dollar: i.e., they sold marks they hadn’t got, knowing that they could buy them for a fraction of their present value when the time came to meet the demand. When the mark stopped falling, thanks to the Reichsbank’s engineering, they had to rush to close their positions, and were forced to buy marks which had actually begun to go up. Many speculators lost the entire fortunes which they had built up over the year.

Schacht’s measures sufficed to stop the rot, but in the period between the ordnance declaring the new currency and the appearance of the first notes, there was an interim of pure chaos in which, as Lord d’Abernon noted, "four kinds of paper money and five kinds of stable value currency were in use. On November 20,1923,1 dollar =4.2 gold marks =4.2 trillion paper marks. But by December the currency was stable." The last November issue of the weekly Berliner Ulustrirter Zeitung cost a billion marks, the first December issue 20 pfennigs. Confidence seemed to have been restored overnight. Germany could breathe again.

There were those, however, who could not accept that the old certainties were lost, as this sad little postscript will prove. In the old days the highest denomination printed had been the brown thousand-mark note which had a prestigious, almost magic significance. Many people among the older generation found it impossible to accept that its value was now gone forever. The notes were seen as the symbol of the golden age of stability before inflation, and it was the touching hope of many that one day they would be restored to full value. In the meantime they were hoarded and even collected. They could be bought in the Munich flea market for five marks a million. That there was still a demand for them at all is proof of the belief that one day the Reichsbank would honor its pledge and exchange paper for gold. Weimar’s electoral system of proportional representation encouraged the proliferation of small political parties, of which there were many. But without a doubt, the strangest and saddest political party of them all was the "Party for the Revaluation of the Thousand-Mark Note.".

 

FOOTNOTES

Chapter 6 – INFLATION

1 d’Abernon, vol. II, p. 23
2 Ibid, p. 22
3 Ibid, p. 24
4 Bonn, p. 2 78
5 Buck, p. 143
6 Ludecke, p. 148
7 Zweig.p. 237
8 Ibid, loc. cit.
9 Daily Express, February 24, 1923
10 Ostwald,p. 63
11 Adlon.p. 99
12 Ostwald,p. 130
13 Clark, p. 11
14 Ibid, loc. cit.
15 Ibid, p. 12
16 Schonberger, p. 155
17 Ostwald.p. 181
18 Adlon.p. 98
19 Ostwald, pp. 84-5
20 Tynan.p. 132
21 Ibid, p. 157
22 Zweig.p. 223
23 Tynan.p. 157
24 Lochner, p. 102
25 Ibid, p. 103
26 Got, p. 67
27 Ibid, p. 57
28 Weltbuhne,
November 1922
29 Beraud.p. 82
30 Buck, p. 163
31 Ibid, p. 141
32 Ibid, loc. cit.
33 Beraud.p. 22
34 Mann, p. 77
35 Fallada, Wolf, Among Wolves, p. 15
36 Zweig.p.238
37 Landauer, pp. 77-80
38 Got, p. 53
39 Buck, p. 232
40 Zweig.p.238

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WALL STREET CAST ITS VOTE FOR NEW YORK FEDERAL RESERVE PRESIDENT TIMOTHY GEITHNER FOR TREASURY SECRETARY, RALLYING IN HIS FAVOUR

Posted by Gilmour Poincaree on November 22, 2008

November 22, 2008

LATEST: Rob Curran

Article from: Dow Jones Newswires

The Dow Jones Industrial Average surged nearly 500 points in the last hour of trading after reports Reutersthat president-elect Barrack Obama would name Mr Geithner to the top Treasury post.

Buyers became energised after a report by NBC News that Mr Obama will personally unveil Mr Geithner as the incoming Treasury boss at a news conference on Monday, along with other members of his economic team.

The report by NBC’s Andrea Mitchell, who is married to former Fed chairman Alan Greenspan, cheered depressed investors, even though there was no immediate confirmation.

“The market is running up on the news that Timothy Geithner will be the next treasury secretary,” said Peter Cardillo of Avalon Partners.

“Maybe it can bring confidence back.”

Yet the Dow still lost more than 5 per cent on the week, as Citigroup plunged to levels not seen in 15 years and traders worried about the survival of General Motors and Ford.

Mr Geithner, 47, is intimately familiar with Wall Street and worked on recent rescue efforts for the financial system. Those rescue efforts are a work in progress, however.

Citigroup fell US94 cents, or 20 per cent, to $US3.77, taking its losses to 60 per cent for the week and 72 per cent for November as the bank scrambles to review strategic options.

Selling of Citi’s shares grew heavier after chief executive Vikram Pandit said he had no desire to sell the Smith Barney brokerage unit. The stock’s close was the lowest for Citi since the last day of 1992; it has lost more than $US53.8 billion ($67.7 billion) in market value in November.

“It’s mind-boggling,” said Bud Haslett, chief executive of Miller Tabak Capital Management.

Traders say the Treasury Department’s decision last week not to buy distressed assets abruptly changed the outlook for banks.

“The change in the direction of the Troubled Asset Relief Program was the major thing” weighing on financials, said Peter McCorry, senior equity trader at Keefe Bruyette & Woods. “Changing the rules of the TARP is an indication that the rules can and will change mid-game.”

The Dow rose 494.13 points, or 6.54 per cent, to 8046.42, its biggest gain in more than a week.

The broad S&P 500 index rose 47.59 points, or 6.32 per cent, to 800.03, a day after closing at its lowest mark since 1997. The tech-oriented Nasdaq Composite added 68.23 points, or 5.18 per cent, to 1384.35. For the week, the Dow lost 5.3 per cent, the S&P 500 lost 8.4 per cent and the Nasdaq was down 8.7 per cent – and all three had their biggest drops in four weeks.

In response to Wall Street, the Sydney Futures Exchange’s December share price index futures contract jumped 68 points to 3500, representing an 83.5-point premium to the benchmark S&P/ASX 200 Index and suggesting a solid start to the Australian market on Monday.

The Australian dollar settled offshore trading at just above US63 cents.

In the most volatile Wall Street market since the 1930s, traders say it takes little to push the market in one direction or another.

“We’re dealing with a lot of redemptions,” said one manager at a fund of funds, indicating that forced selling due to clients’ requests for cash is ongoing.

Goldman Sachs Group rose $US1.31, or 2.5 per cent, to $US53.31, finishing the week with a loss of 20 per cent. Morgan Stanley rose US85c, or 9.2 per cent, to $US10.05, but declined 16 per cent on the week.

The model of Wall Street banks is under strain as investments across all asset classes turn sour, and trading with leverage goes out of style.

KeyCorp fell US64c, or 9.3 per cent, to $US6.27 after the regional bank slashed its dividend.

Dell shed US51c, or 5.2 per cent, to 9.30. Third-quarter profit exceeded the Wall Street estimate, helped by cost cuts, but revenue fell to $US15.16 billion from $US15.65 billion a year earlier.

The shopping season begins in force next week, and traders will see if consumer-spending fears are justified. The Consumer Select Discretionary SPDR, a basket of retailers and other consumer stocks, rose $US1.12, or 6.9 per cent, to $US17.45, but fell 9 per cent this week, just one of many wild swings.

Gold mining companies surged as a wave of “deflation” fears receded for now.

Gold is used as a safe haven, but also a hedge against inflation, a market worry that was replaced by deflation lately. Newmont Mining added $US5.79, or 25 per cent, to $US28.79, but has fallen by almost half since its peak.

In Europe, the London FTSE 100 index fell 2.43 per cent to 3780.96 points — its lowest closing level since April 3, 2003, capping an overall fall of 10.68 per cent for the week.

In Paris, the CAC 40 plunged 3.33 per cent and in Frankfurt the DAX shed 2.20 per cent, with banks Allianz and Deutsche Bank among the heavy losers.

“Although this morning saw a slight rally for the UK market, the afternoon has seen these gains eroded with the market nose diving,” said David Jones, a strategist at IG Index in London.

“Sentiment this week has turned even gloomier than we have been used to of late.”

Additional reporting by AFP and staff writers

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Posted in BANKING SYSTEM - USA, BANKING SYSTEMS, CENTRAL BANKS, COMMERCE, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, ENGLAND, FINANCIAL CRISIS - USA - 2008/2009, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, FRANCE, GERMANY, GOLD, INFLATION, RECESSION, REGULATIONS AND BUSINESS TRANSPARENCY, STOCK MARKETS, THE FLOW OF INVESTMENTS, USA | Leave a Comment »

ENDIVIDAMENTO DA ALEMANHA SERÁ QUASE O DOBRO DO PREVISTO EM 2009 (Germany)

Posted by Gilmour Poincaree on November 19, 2008

Publicação: 19/11/2008 11:00

FolhaNews

Publicação: 19/11/2008 09:18

O endividamento da Alemanha será, em 2009, quase o dobro do previsto pelo governo, em Fifteen months ago - Reiner Holznagel, manager of the German taxpayer's federation stands in front of the 'Debt Clock' which shows the amount of state debt in Germany 01 August 2007 in Berlin. The 'Debt Clock' has been adjusted reducing the amount of new debt per second in Germany from 1,056 Euro to 539 Euro per second. The reduction is possible due to the increase in overall inland revenueconseqüência da crise financeira internacional, informa nesta quarta-feira (19/11) o diário “Süddeutsche Zeitung”.

Segundo a reportagem, o endividamento deve subir para 17,9 bilhões de euros (US$ 22,5 bilhões), frente aos 10,5 bilhões de euros (US$ 13,2 bilhões) previstos na minuta orçamentária elaborada no meio do ano. A comissão orçamentária diz que terá nesta quinta-feira (20/11) uma versão revisada da minuta para o orçamento geral do governo em 2009.

O ministro das Finanças, Peer Steinbrück, tinha estipulado como objetivo eliminar o déficit governamental até 2011, mas após a explosão da crise internacional, reconheceu que a meta não poderá ser alcançada antes do final da próxima legislatura – ou seja, até 2013.

Os novos dados divulgados pelo “Süddeutsche Zeitung” põem inclusive em dúvida o novo objetivo, pois, segundo o diário, os planos orçamentários a médio prazo indicam que em 2012 ainda haverá um novo endividamento de 10 bilhões de euros (US$ 12,6 bilhões).

O Produto Interno Bruto (PIB) da Alemanha caiu no terceiro trimestre de 2008, a segunda queda consecutiva do indicador, colocando a maior economia da Europa em recessão. O PIB caiu 0,5% em relação ao segundo trimestre do ano, segundo dados do Departamento Federal de Estatística. No segundo trimestre do ano, a economia alemã teve um retrocesso de 0,4%, enquanto no primeiro, o PIB subiu 1,4%. As quedas são as primeiras desde 2004.

A baixa do PIB alemão teve sua origem na queda das exportações e na redução da demanda interna. O departamento de estatística, com sede em Wiesbaden, informou que a baixa do PIB se deve fundamentalmente ao retrocesso da atividade econômica nos meses de julho a setembro.

As exportações, o principal motor da economia alemã, sofreram uma queda nos meses do verão europeu e, como as importações registraram de forma simultânea uma alta significativa, as vendas no exterior não contribuíram suficientemente para o crescimento.

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Posted in COMMERCE, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, FINANCIAL CRISIS 2008/2009, GERMANY, INDUSTRIAL PRODUCTION, INDUSTRIES, INTERNATIONAL, RECESSION, THE FLOW OF INVESTMENTS | Leave a Comment »

RAINER SIMON ON HIS LOVE OF ECUADOR AND MAKING MOVIES IN THE FORMER EAST GERMANY

Posted by Gilmour Poincaree on November 16, 2008

Nov 14, 2008

Renowned German film director Rainer Simon has been on a fall 2008 tour of North American Rainer Simon - © DEFA Film Libraryuniversities organized by the DEFA Film Library at the University of Massachusetts Amherst.

Simon began his career at the DEFA Studio for Feature Films and became one of the most important East German directors. He is also the only GDR (German Democratic Republic) director who was ever awarded with the Golden Bear at the International Berlin Film Festival.

Six of his most important films and his Latin American documentary trilogy are part of the presented film program: The Airship (1982), a fantastic, experimental film about the dream of flying; the German family saga Wengler & Sons. A Legend (1986); and The Ascent of Chimborazo (1989), which is about Alexander von Humboldt’s expedition to Ecuador.

Simon’s comedy Till Eulenspiegel (1974), the banned film Jadup and Boel (1981), and The Woman and the Stranger (1984), which was awarded the Golden Bear in 1985, were newly subtitled into English by the DEFA Film Library and are celebrating their North American premiere on this tour.

Germany.info caught up with Simon during a stopover at the Goethe-Institut in Washington, DC, which also screened several of his films as part of his tour.

You are currently on a North American tour during which your films are being screened in various The Colors of Tigua - © DEFA Film Librarylocations and you are discussing them with viewers. What kinds of questions are you most frequently asked?

I spent three weeks in Canada and then moved on to the US, where I have been exclusively at universities.

For the youngest people memories of a time before the Fall of the Wall are minimal. So I always have to start from the beginning and explain what the GDR was and what the DEFA was. It’s different of course with the more mature graduate students, who tend to ask more detailed and interesting questions.

Mostly of course there are questions about what it was like to make movies in the GDR – how much of a role did censorship play?

In the socialist countries there was the censorship of the ideologues, but now there is the censorship of money. Based on my own experiences and the experiences of many of my colleagues that is really much more difficult than the censorship of the ideologues. It is not as if you can just do whatever you want today.

How would you describe you life’s work until now? Would you refer to two phases – in Germany and later in South America?

My films are devoted to very different topics. They run the gamut from a historical comedy like Till Eulenspiegel to a contemporary story like Jadup and Boel to other themes drawn from German history, and then there are my three documentary films from Ecuador, so luckily I do not always have to speak about the same topic (grins).

And it is in particular regarding these films made in Ecuador that people often ask me about what it was like to work with the indigenous people. And it seems to me they are always surprised when I say our collaboration was excellent and how important it was to me that they wanted to work so hard at being so actively involved in these projects. So we did not just go there and use them. And that is precisely what attracted me.

How would you describe the legacy of the DEFA film studios? Were there particular regulations that Till Eulenspiegel - © DEFA Film Library you and other filmmakers had to follow, or were you given a lot of artistic freedom? Why could you, for example, only screen your film Jadup and Boel years after it was made? Were legendary German figures like Till Eulenspiegel easier to portray?

Till Eulenspiegel is based on a story written at the time by (East German writers) Christa and Gerd Wolf. I was in particular interested in Till Eulenspiegel as an anarchic figure, who clashed with the powerful people of his time in a very blunt and direct manner. He tore the masks from their faces but at the same time exposed the stupidity of the little people, over and over again. Till Eulenspiegel was a contemporary figure in his time and still is today. Who would really take it up the way he did today with the people in power in our own time?

The film was a really big hit in the GDR at the time with over one million viewers in such a small country. So people understood that this was not really a historical film, but that the attacks of Eulenspiegel were also attacks against the regime of the GDR, that they applied just as well to the ruling classes in our country, or anywhere else for that matter. And when you watch that movie today it is relevant all over again – people apply it to their own era.

We only had one state-run film production company at the time, not 100,000 or more different producers like here, and that was the DEFA. And so the money for these films came exclusively from the state. And like always the sponsor wants to see his ideas realized (grins ironically).

It was more difficult to make the movies you wanted in the early days, in the 1950s, when I was luckily not involved yet. That was the toughest time, during and right after the Stalin era, when the mindset was the most propagandistic. Later it became much easier to make movies. Although it is true that during the entire history of the GDR the DEFA studios produced at least two anti-fascist films annually. That was just something which always happened every year – those kinds of films just had to be included on the annual agenda.

But the films which led to the toughest disputes with the authorities were those that portrayed real life in the GDR. And those weren’t made until a younger generation born during or right after the war that grew up in the GDR – my generation – started to make movies. We wanted to make realistic films about life in the GDR. And that led to conflicts with the authorities. But screenplays were generally heavily scrutinized during the entire production process. And so films were rarely forbidden after 1965 – a censored film was really more the exception than the norm.

So what happened in 1980 with my film Jadop and Boel was unusual. They didn’t pay enough Jadup and Boel  - © DEFA Film Libraryattention with that one. It’s about a mayor in a small town in the GDR who realizes in the middle of his life that his socialistic ideals no longer work. And the main critique against us at the time was: “Our lives are not so ugly, so grey, so triste as you portray them!”

But we did not exaggerate at all. It was a realistic study of this time, without us having to expand upon anything in particular. And all the people knew that things were really like this – only the authorities did not know it was really like this.

After Jadop and Boel I decided that I would not do anything else about the GDR, because “you will forbid me from doing it again.” And so I only made movies featuring historic topics that did not address contemporary problems, and luckily I was allowed to continue doing that. And that was when I made some of my most important films, like The Woman and the Stranger, which won the Golden Bear at the Berlinale, like Wengler and Sons and The Ascent of the Chimborazo. Those were all very important films for me.

The Ascent of the Chimborazo was also the first, the only and the last co-production between the The Ascent of the Chimborazo  - © DEFA Film LibraryGDR and the Federal Republic of Germany. In the 1980s both sides wanted to make a co-production, as there had a already been a lot of collaboration before. And we were looking for a topic that would be politically palatable to both sides and so we hit upon Alexander von Humboldt (the film chronicles the famous 19th-century German naturalist and explorer’s ascent of this South American mountain). And so we got really lucky with that and were happy that the film was not just funded by GDR money.

Was there any other kind of creative exchange in this regard between East and West Germany? How easy was it for you and your crew to travel?

There was cooperation before, as in for my films Wengler and Sons and The Airship, where certain scenes had to be shot in the West – and the GDR of course had no western money. So deals were struck in advance between DEFA and (West German) public broadcaster ZDF, for instance, with rights sold in advance so that we could go shoot in the West, including some scenes in Italy and Spain. We always traveled with a small crew. These were generally short scenes and did not involve huge sums of money. Every now and then there was a problems for someone not being allowed to travel, but mostly it worked somehow.

What do you think of German film today, and of the next generation of German directors, like The Airship  - © DEFA Film LibraryAndreas Dresen, who is also originally from the East? And what did you think of Florian Henckel von Donnersmarck’s megahit The Lives of Others? Some East Germans seemed to think the film did not accurately portray life the way it really was in the GDR. Do you agree?

I know all about this criticism against Donnersmarck. This film was condemned by many in the East, including many of my colleagues, who claimed “but life was not really like that then.” I am not that much of a fundamentalist about it. I think it’s a really good film as a thriller – not necessarily as a realistic film about daily life in the GDR, although it does of course tell you something about the GDR.

And I think that 20 years after the fact we have to tolerate this kind of creative freedom. If I had made a movie about World War II and the fascist time in Germany 20 years after the end of the war, then it would probably look different than a movie made by someone who was actually really there.

Otherwise I do no think that German cinema is in a great place. In the United States it is only possible to see German films in art house theatres in a few locations. There are a lot of very good small German films, but nobody gets to see them!

Andreas Dresen is pretty much the only young East German director who has really made a name for himself since the Fall of the Wall, and he makes very good films.

How do you view the future of German film? Are you pleased that big, international productions The Woman and the Stranger  - © DEFA Film Libraryare being made in Berlin-Babelsberg again? Will Berlin once again become a more important center for the global film industry?

All of that with Babelsberg is a joke. Before the Fall of the Wall films were being shot there around the clock and all the studios were perpetually occupied. Afterwards a French water company came and bought it up and then closed it. And then, with the eager support of Volker Schlöndorf, they made it what it is now: Every few years a Hollywood director shows up and makes a movie there. That is a joke.

You spend a lot of time in Ecuador, where you have made several documentaries and conducted filmmaking classes. Are you working on any new projects right now?

The Ascent of the Chimborazo was released two months before the Fall of the Wall. I fell in love with this country and its people. I made three low-budget films there with Indians in the mountains and in the jungle. I organized workshops, I was at their film festivals and I presented this films all over South America. For me my work in Ecuador was much more satisfying than my work in Germany …

And now I’ve started writing. In 2005 I published my autobiography Die DDR, die DEFA und der Ruf des Chimborazo (The GDR, the DEFA and the Call of the Chimborazo).

And that same year I published my first novel, Regenbogenboa (Rainbow Boa), which is about a German man who has spent the last 30 years in Ecuador and in which I refer back to my own experiences there.

I have also taken up photography and have an exhibition on in New York called “Living with Mother Earth.”

How do you perceive Germany’s role globally? Do you think Germany is a role model when it comes Talking With Fish and Birds  - © DEFA Film Libraryto modern environmental technologies? What about the United States? Do you think we are about to enter a new era of change here?

Germany is definitely among the countries that try the hardest in this regard. And Germany really does have a lot to contribute here.

In the former GDR we had a lot of pollution and environmental problems that thankfully have been mostly cleaned up now. When I was driving in a car between Iowa and Illinois I suddenly saw and industrial site that looked just like these things did back then in the GDR and suddenly it stank extremely just like it did in the GDR, and I was quite surprised and really wondered about that.

Regarding change in America we can only hope that Obama will have the strength to push through the necessary measures (to help protect the environment).

The indigenous people in Ecuador understand that human beings are part of nature. This means that they do not see human beings as the pinnacle of conception, as we do in the Christian tradition, but really one part of the whole that makes up the natural world. In their world, human beings are worth just as much as a plant or an animal.

We could learn a lot from them.

DEFA Film Library at the University of Massachusetts Amherst

Goethe-Institut USA

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Posted in CINEMA, ECUADOR, GERMAN FILM PRODUCTIONS, GERMANY, INTERNATIONAL RELATIONS | Leave a Comment »

BRANDENBURG A SHINING STAR FOR RENEWABLE ENERGY (Germany)

Posted by Gilmour Poincaree on November 16, 2008

Nov 14, 2008

When Germany celebrated its reunification in 1989, the state of Brandenburg was a symbol of a failed Wind turbines, like these in Jacobsdorf, can be found across Brandenburg - © picture-alliance - ZBcommunist ideology.

Lignite strip mines marred its polluted landscape. Its lack of modern infrastructure combined with exposure to West Germany’s competitive market economy brought about widespread unemployment.

Yet this month Brandenburg was one of three states named Germany’s ‘Lodestar 2008’ for fully embracing and promoting the use of renewable energy.

The award is the result of a study that produced a unique database of renewable energy statistics. Commissioned by Germany’s Renewable Energy Agency and carried out by the German Institute for Economic Research and the Centre for Solar Energy and Hydrogen Research, every German state was compared in 49 separate categories. The states were judged on the degree of political support for renewable energy, the amount of investment to promote it, and the ultimate success of these efforts.

Brandenburg shared the top spot with two western German states, Schleswig-Holstein and Baden-Wuerttemburg.

It’s an extraordinary transformation for a former East German state which has successfully overseen a radical technological and economic turnaround in the last twenty years. This recognition of its success in clean energy production, though, is no reason to slow down the progress and innovation, says Matthias Platzek, Brandenburg’s Minister-President.

“When we installed our first wind turbine in the ‘90s during my time as Environment Minister here in Brandenburg Minister President Matthias Platzek - © Landesregierung BrandenburgBrandenburg, many people laughed at us,” he remembers.

Platzeck’s belief in the benefits of renewables is supported by hard facts. Renewable energy has already created 4,000 long-term jobs in Brandenburg. The state is a leader in solar technology, and is Germany’s top wind energy producer. And by 2020, fully one-fifth of Brandenburg’s energy needs and an impressive 90% of its electricity demand will be covered by wind, solar, biomass, hydro power and geothermal energy.

There is, nevertheless, still room for improvement. Although Brandenburg is a strong producer of solar energy, its actual use of solar energy remains relatively weak.

Critics also point to Brandenburg’s on-going reliance on lignite or brown coal. Carbon dioxide emissions from brown coal fired plants are generally much higher than for black coal plants, and their continued operation, particularly in the absence of emissions-avoiding technology, is controversial.

Platzek argues that energy from both renewable and traditional sources are necessary to cover current energy demands. He maintains brown coal is an acceptable energy source if extracted using technology that reduces CO2 emissions.

He’s also convinced, however, that renewables should be the focus of the future, and statistics back this up. The turnover of Germany’s renewable industry was 24.6 billion euros in 2007, and the share of electricity generated from renewable sources reached 14.2 percent, meaning Germany has already met the European Union’s national target that 12.5 percent of electricity should come from renewable sources.

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PUBLISHED BY ‘GERMANY INFO’

Posted in AEOLIC, COMMODITIES MARKET, ECONOMIC CONJUNCTURE, ECONOMY, ENERGY, GERMANY, INDUSTRIES, INTERNATIONAL, THE FLOW OF INVESTMENTS | Leave a Comment »

RUSSIA’S ANTI-CRISIS BILL TOPS $222BN

Posted by Gilmour Poincaree on November 14, 2008

13/11/2008

The world’s leading countries have spent (or allocated) a whopping $9.2 trillion on anti-crisis measures, with the UK in the lead, having already spent 37 percent of its GDP for the purpose. For Russia, the crisis has so far cost $222 billion, or 13.9 percent of its GDP. The estimates are provided by FBK Company, based on a number of public resources like press releases by governments, central banks and the International Monetary Fund, RBC Daily has reported.

In choosing an anti-crisis strategy, western governments pay particular attention to the mechanisms of guarantees and insurance, according to the FBK report. In Germany, for instance, state guarantees for corporate debts total EUR 400 billion. Russia, on the other hand, has adopted a completely different approach, focusing on direct cash allocations instead of guarantees.

The government’s anti-crisis plan, which was approved earlier this month, provides for some guarantees, but only in regard to companies carrying out state orders. Meanwhile, the mechanism of government guarantees is set out by law, including the budget law. “Thus, state guarantees could have been used as the main anti-crisis tool, but this has not happened,” noted Igor Nikolayev, chief strategic analyst at FBK, who co-authored the report.

What Russian and foreign anti-crisis efforts have in common is that financial regulators are not accepting responsibility for the crisis. It is very difficult to bring them to account, believes Elena Sharipova, at Renaissance Capital. “What claims can be made against Finance Minister Alexei Kudrin or Central Bank Chairman Sergei Ignatyev? They had reasons to save for a rainy day,” she added.

U.S. law, however, envisages responsibility for poor management, the report says. Under the RARP program, for example, top managers who brought their companies to such a poor condition will lose all their bonuses. In Germany, the shareholders in cash-strapped banks go without dividends, too.

In Russia, however, managers and owners are simply not held responsible. Yet, businesses should assume their fair share of responsibility for what is happening, FBK’s experts argue. “This is an obvious thing abroad, but not in Russia. We continue to rescue people in Brioni suits,” the report says.

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PUBLISHED BY ‘RosBusinessConsulting’ (Rumania)

Posted in BANKING SYSTEMS, CENTRAL BANKS, ECONOMIC CONJUNCTURE, ECONOMY, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, GERMANY, IMF, INTERNATIONAL, REGULATIONS AND BUSINESS TRANSPARENCY, RUSSIA, UNITED KINGDOM | Leave a Comment »

ECONOMIA ALEMÃ TEM CONTRAÇÃO DE 0,5% NO TERCEIRO TRIMESTRE (Germany)

Posted by Gilmour Poincaree on November 13, 2008

Publicada em 13/11/2008 às 07h59m

por Juliana Cardoso – Valor Online

SÃO PAULO – O Produto Interno Bruto (PIB) da Alemanha caiu 0,5% no terceiro trimestre deste ano ante os três meses anteriores, quando cedeu 0,4%, respeitando ajuste sazonal, de preço e de calendário. Entre janeiro e março, a economia alemã cresceu 1,4%. Os dados foram apresentados nesta manhã pelo Departamento Federal de Estatísticas (Destatis).

“Um efeito negativo no PIB veio do comércio exterior, com forte avanço nas importações e debilidade das exportações”, sustentou o organismo. “Uma coisa é clara: a Alemanha está em recessão”, comentou o economista do Commerzbank em Frankfurt, Ralph Solveen, em nota.

Considerando ajuste de calendário, a economia alemã cresceu 0,8% no terceiro trimestre em comparação com igual período de um ano antes.

As informações são do Destatis e agências internacionais.

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PUBLISHED BY ‘PORTAL G1’ (Brasil)

Posted in ECONOMIC CONJUNCTURE, ECONOMY, FINANCIAL CRISIS 2008/2009, GERMANY, INDUSTRIAL PRODUCTION, INTERNATIONAL | Leave a Comment »

IMF LOAN AVERTED POSSIBLE BANKRUPTCY AND SOCIAL CRISIS – PM (Hungary)

Posted by Gilmour Poincaree on November 3, 2008

Budapest, November 1, 2008 – (MTI)

Without the IMF standby loan granted earlier this week, the financial crisis in Hungary could have led to bankruptcy and social crisis, Prime Minister Ferenc Gyurcsany told the Sunday newspaper Vasarnapi Hirek, which made the interview available to MTI on Saturday evening.

The PM was disputing a statement by opposition Fidesz party chief that accessing the line of credit from the International Monetary Fund was “shameful”.

In a worst-case scenario, the forint, Hungary’s currency could have continued sinking to 350/400 to the euro, triggering 20 to 30 percent inflation, he said.

It had dropped from 238/240 to the euro to 280/285 at the time the loan was announced, and firmed to 255/260 in the aftermath.

The other part of the problem, he said, was that Hungary was already having a hard time finding buyers for government securities. If it failed to sell them, all its foreign loans would have had to be paid off within three to six months, leaving the country without the money to pay government employees such as teachers and doctors, or to pay pensions, the PM continued.

“That would have been shameful,” Gyurcsany said.

What we were facing could have evolved into bankruptcy, said the PM, adding that two-thirds of the problem was caused by the international crisis and one-third by domestic shortcomings. As far as the domestic portion is concerned, the government is partly, but not wholly responsible. One concern is that residents have not saved any money since 2000/2001, leading to excessive spending and borrowing. Residents and businesses have done the lion’s share of their borrowing in foreign currencies, he added, which means an enormous foreign debt. In addition, there has been such – opposition initiated – resistance to reforms in the past two years that Hungary was extremely vulnerable, the PM suggested.

British Prime Minister Gordon Brown, German Chancellor Angela Merkel and French President Nicolas Sarkozy had all played key roles in securing the IMF loan for Hungary, Gyurcsany told Vasarnapi Hirek.

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PUBLISHED BY ‘MTI HUNGARIAN NEWS AGENCY’ (Hungary)

Posted in BANKING SYSTEMS, CENTRAL BANKS, ECONOMIC CONJUNCTURE, ECONOMY, ENGLAND, EUROPE, FINANCIAL CRISIS 2008/2009, FRANCE, GERMANY, HUNGARY, IMF, INTERNATIONAL, INTERNATIONAL RELATIONS | Leave a Comment »

JAPANESE GOV’T READIES MONEY FOR NEW IMF BAILOUT FACILITY

Posted by Gilmour Poincaree on November 2, 2008

Sunday, November 2, 2008

TOKYO (AP) – Japan is ready to provide some of its ample cash for any International Monetary Fund bailouts for struggling nations to help stabilize the growing global financial crisis, the finance minister said.

Japan will make that offer along with proposals about accounting standards and other regulatory adjustments needed to fix the growing economic woes at a world summit in Washington Nov. 15, Finance Minister Shoichi Nakagawa told reporters.

Nakagawa did not say the acceptance of its proposals would be needed to get any of the money but he said Japan expects to play a greater international leadership role on the international stage.

He said the IMF has about $ 210-billion funds but that may not be enough.

“Japan is ready if that prove insufficient,” he said, adding that Japan has $ 1 trillion in possible funding from its foreign currency reserves. “We see lending to the IMF basically as risk-free.”

He did not give specifics of what Japan’s proposals may be, stressing that Prime Minister Taro Aso was still hammering out details.

Britain and Germany support the creation of an International Monetary Fund facility to help smaller economies withstand the global financial crisis, Prime Minister Gordon Brown said on Thursday.

“We discussed how we must prevent contagion over the next few days to middle-income countries including in eastern Europe,” Brown told reporters after talks with German Chancellor Angela Merkel.

“It’s vital that the International Monetary Fund plays a central role in supporting these economies. We both agreed to support a new facility for the IMF which would draw on additional resources of countries with substantial reserves.”

IMF chief Dominique Strauss-Kahn told French daily Le Monde he would propose a new regulatory strategy at a meeting next month of the Group of 20 nations.

He said he would suggest a new type of loan to relieve short-term liquidity problems in some economies, and an increase in IMF resources which he said were insufficient to meet requirements over the medium

Nakagawa reiterated his earlier remarks and the views of other Japanese politicians that Japan wishes to exercise political leadership in offering its money and experience in wresting itself out of its bad debt woes of the 1990s.

He said Europe and the U.S. have historical experience with the Great Depression, but Japan has more recent experience and is in a better position to share its expertise.

“We were able to get ourselves out of our problems without help from any other nation,” he said at the Japan Press Center.

Earlier this week British Prime Minister Gordon Brown and German Chancellor Angela Merkel said the International Monetary Fund needs more money to bail out struggling countries.

Brown has called on countries such as China and the oil-rich Persian Gulf states to fund the bulk of an increase in the International Monetary Fund’s bailout pot. The IMF is giving Hungary, Iceland and Ukraine loans and is in discussions with Belarus.

The International Monetary Fund said Wednesday it is creating a new program to get money quickly to developing countries with strong economies that are facing cash crunches in the global financial crisis.

Nakagawa said countries need to respond quickly and work together to get out of the financial problems that started with the U.S. subprime mortgage crisis and is now spreading around the world.

“Japan is taking leadership,” he said.

He said Japan was also doing its part domestically with stimulus spending packages and regulatory changes to prevent a further plunge on the Tokyo stock market.

Merkel said joint action was needed to tackle the crisis.

“I believe the cooperation of the recent weeks has shown we are on the right path,” she said. “We must make risks (in financial markets) manageable.”

Brown said this week that the IMF needed more money to deal with the fallout from the global financial crisis and called on China and the Gulf states to play their part.

Asked about Brown’s call, China’s Foreign Ministry spokeswoman responded vaguely on Thursday but kept the door open to a bigger Chinese role in international rescue efforts.

Brown’s spokesman said he welcomed the positive responses from Germany and China to the proposal “and the indication that they (China) have given that they would be prepared to consider contributing to any such fund”.

Brown has said the issue of giving the IMF more resources will be on the agenda when he visits the Gulf this weekend.

Brown said he and Merkel were “in total agreement” about what needed to be done at a Nov. 15 global summit in Washington to discuss how to reform the global financial system.

“We need to have a transparency that has not existed in every area of the banking system,” he said.

Brown voiced confidence that the leaders would agree in Washington on the need for reforms to global supervision and cross-border cooperation as well as on the need to reopen talks on a new global trade agreement.

Merkel made no mention of a German economic stimulus programme widely trailed in national media, which a senior legislator in her ruling coalition said would be worth 20-25 billion euros ($ 26 billion-$ 32 billion).

Brown defended the decision he made back in 1997 to make the Bank of England independent.

“It’s absolutely the right idea. It’s stability and an anchor for our financial and economic system,” he said.

“The Bank of England has brought down interest rates twice recently. They continue to look at what they can do for the future, but I think we’ve got to understand that the way to deal with this global problem … is by a comprehensive set of measures,” he said, referring to interest rate cuts, tax cuts and British efforts to help homeowners and small businesses.

“I think you’ll see us, in the next few days, in a position to do more to help people face what is a global problem,” he said.

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PUBLISHED BY ‘MANILA BULLETIN ON LINE’ (Philippines)

Posted in ASIA, BANKING SYSTEMS, CENTRAL BANKS, CHINA, ECONOMIC CONJUNCTURE, ECONOMY, ENGLAND, EUROPE, FINANCIAL CRISIS 2008/2009, FINANCIAL MARKETS, GERMANY, IMF, INTERNATIONAL, INTERNATIONAL RELATIONS, IRAN, JAPAN, REGULATIONS AND BUSINESS TRANSPARENCY, THE ARABIAN PENINSULA, THE FLOW OF INVESTMENTS, WORLD BANK | Leave a Comment »