CRISIS

smallbusiness

Over 10pc of British small companies planned to close during last quarter

LONDON | Even before the office for national statistics released its estimates of a UK economy in continued slow-motion deterioration, 84 percent of small and medium size companies’ decision makers said they were concerned about the British economic climate, with 38% being very concerned. A new SME Risk Index from global insurer Zurich published Friday showed that the majority in the sector do not feel confident that the economic situation will improve in…


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Goodbye to the American Golden retirement?

NEW YORK | Times are tough for pensions. Retirement plans are not golden anymore. After the crisis, U.S. companies started to get rid of many pension funds or are allocating less money for them. And while the market has substantially recovered from the 2009 low, pension funds portfolios as well as supplemental savings and retirement accounts for individuals remain significantly smaller than they were at their peak. Last year, Standard…


No Picture

Bernanke’s speech on Europe: reading the tea leaves

NEW YORK | Federal Reserve’s chairman Ben Bernanke attended his semi-annual monetary policy report to Congress on Tuesday and Wednesday, insisting that the Fed remains in close contact with European authorities but the alarms of spillover are still on. “I don’t think they [Europe leaders] are close to having a long-term solution that will solve the problem and until they find those long-term solutions, we’re going to continue to see…


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No sovereign bond haircut for Spanish banks? That’s not serious

MADRID | Everyone seems to skip the nagging fact that stress tests undertaken by Oliver Wyman and Roland Berger only focused on credit risk. Thus, the extra capital requirements only reflect shortcomings in the banking book due to potential bad loans. But any serious test has to embody securities risk in general and sovereign bonds in particular. The European Banking Association has performed it every time it has put European…


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The ephimeral Olympics’ effect

LONDON | How much the £16.5-billion pill administered by the London 2012 Olympics will help reinvigorate the British economy is shortly to become a matter of debate. The figure came Monday under the signature of Lloyds TSB, which released a research study that forecast increasing activity until 2017 across key sectors like construction and tourism. Just weeks before the celebrations, the City seems drawn to spark the discussion. Indeed, investment…


No Picture

The Greek negotiations

how do you get a ex girlfriends trust back if it been months After New Democracy's win in the recent general elections in Greece with 29.8 percent of voting support, a coalition with Pasok seems the most reliable option. Together, both parties would gather 162 parliament seats and a sufficient majority (overall majority is obtained with 151 seats) to raise a stable government favourable to accept further austerity measures from…


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Exchange traded funds, one more known unknown for the markets

letter for boyfriend i want you back LONDON | Who will set the alarm bells off, again? Amid so much scarring noise coming from the euro area, watchdogs may inadvertently pass by seeds of future financial crashes. This time, the hint is that most financial advisers in the City admit to have little or no understanding of the exchange traded funds' structure, but up to 30 percent in the industry keep some 5 percent…


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Let’s escape the wreck and keep sailing

MADRID | “It is time to resort to the International Monetary Fund or the European rescue fund,” wrote in the January edition of Revista Consejeros Aristóbulo de Juan, former Bank of Spain's director general of inspection. Even Banco Santander's chairman Emilio Botín, who's always shown his antipathy to salvage competitors with his money or the taxpayers', acknowledged that the Spanish banking sector needed some €40 billion in European aid to…


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All sorts of Eurobonds

By Luis Martí, in Madrid | Amid the recent flurry of proposals for restructuring of the euro zone and opinions on its decomposition, seasoned with all sorts of half truths, two reports –one of the European Commission, by order of Parliament, and one of the Council of Economic Experts which advises the German government– have seriously dealt with the viability of Eurobond-based-solutions. The Commission's report was published late 2011 as a…


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Alan Meltzer has a solution for the euro

WASHINGTON | “Capitalism without failure is like religion without sin, it does not work,” had already said Allan Meltzer in 1969. Pittsburgh's Carnegie-Mellon University teacher and author of the monumental History of the Federal Reserve is the same conservative who advised John F. Kennedy and Ronald Reagan. Under Clinton's presidency he was in charge of a U.S. Congress committee that essentially claimed the end of the World Bank on the basis…