HEADLINES: The desensitising tsunami predicating financial Apocalypse rolls on …

Posted by Nunc on September 27, 2011 · 3 Comments 

It’s like being bound to a breakwater, whilst being pounded by a 24/7 tsunami onslaught.

Wave after wave of constant battering by financial bad news; most of it Apocalyptic, with the only respite being the severity of the doom and the extent of the gloom.

 

Here’s a taste of the latest Aquatic Armageddon to anoint the, arguably, artificially actualised angst.

 

Eurozone

Christine Lagarde: IMF may need billions in extra funding: Christine Lagarde has signalled that the International Monetary Fund (IMF) may have to tap its members – including Britain – for billions of pounds of extra funding to stem the European debt crisis.

Pressure grows on Germany to lead Euro rescue: Angela Merkel was battling against opposing forces at home and abroad urging her to spearhead a multi-trillion shock and awe Euro rescue package. The world community, headed by the United States, is calling on the German Chancellor to lead the way on setting up a huge financial firewall to protect the Euro and measures to bolster European lenders.

Eurozone crisis: facility management: Every new disease sets off the hunt for the blockbuster remedy. Policymakers seem to think they are on the brink of discovering a miracle cure for the Eurozone sovereign debt crisis, in the shape of the European financial stability facility. The EFSF was created to fund countries shut out of the markets. It can do more including recapitalising Europes banks but only if it is restructured. However, policymakers need to be honest with taxpayers about the risks involved. It is capitalised at 440 billion to meet the financing needs of Ireland, Portugal and Spain. That heft is a bit illusory, however, since extra guarantees and cash buffers keep its lending limit nearer to 250 billion. The facility is being revised to boost this effective lending capacity to 440 billion and its guaranteed commitment to 780 billion. Germanys parliament is to vote on that expansion on Thursday. If MPs approve, it will give Eurozone policymakers a potent weapon in the fight against crisis contagion.

Germany at war over Eurozone bail-out: European officials have confirmed that discussions are afoot to boost the Eurozone bail-out funds firepower as part of a grand plan to contain the regions sovereign debt crisis in Greece.

Dithering European policymakers fail to calm volatile stock markets: Stock markets endured a day of sharp volatility amid uncertainty about how Eurozone leaders intend to solve the ongoing and increasingly pressing crisis that is gripping the single currency and threatening global growth.

Bankruptcy threat to Greece as Euro Ministers delay vital 8 billion: The spectre of bankruptcy is hanging over Greece, with the prospect of hundreds of thousands of civil servants going unpaid next month, as Eurozone Finance Ministers refused to put a date on the release of a crucial 8 billion (6.9 billion) cash infusion for the country.

Europe in massive U.S. style bailout: Emergency plans were being drawn up for a massive boost to the Eurozone’s bailout facility to protect the banking system from the fallout of the Greek debt crisis. The Times has learnt that German officials are studying plans to increase the fund’s effective size by 1 trillion Euros to buy up high-risk sovereign debt, in a scheme similar to the $700 billion bank bailout in the United States approved by George Bush in 2008.

Greece is bullish but the markets brace for a major default: World leaders piled pressure on Eurozone countries to resolve the area’s sovereign debt crisis after a meeting of the International Monetary Fund that revealed more dissent than determination and left financial markets with further troubling news and rumours to digest.

Banking Parasitism, Mismanagement and Excessive Risk Exposure

Investors tell MPs bank reforms must be watered down: Top institutional investors have warned MPs that the reforms proposed by the Vickers report must be “significantly watered down” to avoid damaging British banks. The warning, which in effect was a demand for a radical U-turn from the Government, was made at a secret meeting between leading investors and members of the Treasury Select Committee last week.

NBNK’s £2.5 billion bid for Lloyds on track: Lord Levene’s bank buy-out vehicle, NBNK Investments, has secured the backing of its ten biggest investors for a £2.5 billion bid for the 600-plus Lloyds Banking Group branches up for sale. The deadline for second round bids for the network is on Friday and analysts believe it could be a close-run fight between the three contenders, also comprising Sun Capital and the Co-operative Group.

Only ECB has power to ‘scare’ global stock markets, warns IMF: The International Monetary Fund has warned that the immense firepower of the European Central Bank (ECB) would be needed to “scare” the financial markets and prevent an intensification of the turmoil threatening to send the global economy back into recession.

UBS rogue trader to hit City bank bonuses: Banks are already under regulatory pressure to shrink their bonus pools to retain more profit as loss-absorbing capital. In addition, trading this year has been poor. With UBS expected to pay significantly lower bonuses as a result of the $2.3 billion (1.5 billion) allegedly lost by Kweku Adoboli, one of its London traders, other banks are expected to bid down staff demands.

Loans insurer could be shut after head quits: The head of the government agency set up to insure Royal Bank of Scotlands riskiest loans is to stand down before the end of the year, in an indication that the scheme could be wound down. The Government has not decided whether to replace Stephan Wilcke, who took over as Chief Executive of the Asset Protection Agency in 2009.

Ill-starred: There is a certain consistency to the pivotal role played by Barclays in the cross-border financing deals that U.S. tax authorities claim were intended to generate artificial foreign tax credits. In the run-up to the publication of Sir John Vickers report on U.K. bank regulation, rumours circulated that Barclays might relocate its headquarters to New York if the conclusions were too irksome. A flexible approach to borders is a hallmark of the archetypal all-conquering multinational as described by admiring neoliberals in the nineties and early noughties. It took the financial and philosophical failure of efficient market theories during the credit crunch to reassert the supremacy of nation states.

U.S. tax authorities target bank deals: U.S. tax authorities are targeting cross-border finance deals worth billions of dollars between leading U.S. and U.K. banks as they step up efforts to clamp down on abusive tax avoidance, a joint investigation by the Financial Times and ProPublica, the not-for-profit news organisation, has found.

UBS: the board loses its nerve: The board of UBS has put its own interests above those of investors. In accepting the resignation of Chief Executive Oswald Grübel following the bank’s revelation of a $2.3 billion unauthorised trading loss, the board gave in to the gallery of public opinion. By losing its nerve at the critical moment, it has lost the man most able to steer the Swiss bank back on course, and, in doing so, created unwelcome uncertainty. Mr Grübel accepted from the outset that the buck stopped with him, but he was expected to stand down only once stability had been restored. In his past two roles, at UniCredit and Merrill Lynch, Mr Ermotti has played second fiddle. He joined UBS only in April, so at least represents an injection of new blood much as Mr Grübel did in 2009. But he will be the fourth Chief Executive officer in four years at UBS and will be seen as a temporary appointee. UBS staffs knew where they stood under Mr Grübel’s tough stewardship, and were fully aware of his priorities. With the flinty former Bundesbank President Axel Weber waiting in the wings to become Chairman from 2013, UBS faces a leadership vacuum at the moment when it most urgently needs significant restructuring.

Long road ahead: Reorganising UBS could take three years: Reorganising the investment bank at UBS will take up to three years to complete, its Chairman said yesterday, a day after Chief Executive Oswald Gruebel quit over the alleged $2.3 billion (£1.5 billion) rogue trading scandal.

[Un]Employment

G20 economies urged to invest in jobs as shortfall heads for 40 million: The G20 group of leading economies could face a shortfall of 40 million jobs next year, with worse to come, without international co-operation to boost employment, the International Labour Organisation warned.

Firms are ‘unready’ for new rules on agency workers: Experts are warning that thousands of small firms may be unprepared for the introduction of Agency Workers Regulations from Saturday. The new legislation will mean that business Owners who employ temporary staff will have to give equal pay and holiday rights to those received by permanent workers if they work 12 weeks or more over the course of a year.

Associated and Interconnected Parasitic Industries

Lloyds claims U.S. hinders disaster recovery: Lloyds of London, which is the largest reinsurer of U.S. risk, has complained that the U.S. government is too interventionist in the insurance market and could damage recovery efforts in the aftermath of national catastrophes.

Move by Brussels catches the Big Four on back foot: They are among the most quietly efficient lobbyists in the world. Rarely are the Big Four accounting firms caught out by regulatory initiatives aimed at them, but that appeared to be the case on Monday when draft proposals circulating in Brussels threatened to upend their entire industry.

S&P under threat of lawsuit over CDOs: S&P said it had received notice from the Securities and Exchange Commission (SEC) that the regulators staffs have recommended a lawsuit be brought against the agency over a mortgage-backed security rated in 2007.

Businesses should invest in Libya say National Transitional Council: Waiting for the dust to settle is a favourite pastime of analysts seeking to draw conclusions from political upheaval in far-flung, often predominantly sandy, nations. But by the time the Libyan air clears, the newly-visible landscape will only contain wellestablished Turkish and French businesses, warned the countrys National Transitional Council (NTC) representative.

Stock exchange ‘must peg fees’ to win backing for takeover: The investment banks that own LCH Clearnet are pushing the London Stock Exchange to guarantee a cap on fees in exchange for control of the clearing house. The LSE, which is scrabbling to shore up its position in the face of a game-changing tie-up between NYSE Euronext in the United States and Deutsche Börse in Germany, emerged this month as the leading contender to buy the London-based clearing house.

Countryside closed to first-time buyers: The door to home ownership in the countryside is open only to higher-rate taxpayers because of the construction slowdown, surging demand in the shires and the loan drought. According to research published by Hometrack, workers in rural areas need an income of £46,500, more than twice average earnings, to climb on to the bottom rung of the ladder. The 40% tax rate becomes payable on incomes of £42,475 and above.

Hundreds march in protest against Wall Street greed: At least 80 people were arrested in New York over the weekend as hundreds marched through the Lower Manhattan financial district in protest against bank bailouts and corporate greed on Wall Street.

FSA staff jump ship as City regulator nears split: The Financial Services Authority is losing an increasing number of employees as the City regulator moves closer to being broken up by the Government. In the first five months of this financial year, 202 members of staff left the watchdog, a 26% increase on the same period last year, according to figures supplied by the FSA.

Tiered pricing opens new markets to pharmas: When executives at Sanofi recently studied variations in the prices of their medicines around the world, they found that poor patients in Senegal were paying more for some of their products than their counterparts in France.

Roche to offer discounts to developing nations: Roche is to set to begin offering substantial discounts in developing countries, marking an important strategic shift for pharmaceutical companies selling high-priced patented biological medicines.

Bureau de change for the worse: Data are notoriously unreliable for currencies, but you can bet your bottom dollar that more than the average numbers of punters are copping a loss from the latest gyrations in foreign exchange markets. It is not as though this pain is the result of a return to some benign exchange rate equilibrium. The Australian dollar, which has fallen 6 cents against the U.S. dollar in the last five days, had attached itself to the China story and was too high for anyone’s good. Likewise, the Swiss franc has reached ridiculous levels on the basis that it is neither the dollar nor the Euro, while the strong yen was so painful that Japan intervened to try to bring it under control. Yet the long-term trend of strong emerging market currencies versus developed ones is exactly what the global economy requires. Recent reversals, if sustained, would be unhelpful indeed. For example, if the U.S. is to have any chance of lower fiscal deficits without company profits disappearing, it requires an improvement in the current account of about 10% of gross domestic product, Smithers and Co estimates. And the only hope of achieving that is through a real fall in the dollar versus fast-growing emerging nations.

Mitchells & Butlers Chief had closer links with bidder Joe Lewis: Past business connections between Mitchells & Butlers caretaker Chief Executive and billionaire currency trader Joe Lewis, who is preparing a controversial takeover bid for the pub group, run deeper than previously disclosed, the Guardian has learned.

Small investors lost £34 billion on stock market as FTSE 100 slumps by a fifth since start of summer: Small shareholders have lost a whopping £34 billion following the stock market rout, research has revealed. The FTSE 100 has tumbled by nearly a fifth since the start of the summer due to mounting fears over the Eurozone debt crisis and a faltering global economic recovery.

Related articles

• War of Terror: Corporatocracy steps up its efforts in elevating economic fears (epinoiasphere.wordpress.com)
• UBS’ Euro Doom And Gloom Team Releases Sequel: “The Eurozone Sovereign Crisis Has Entered A More Dangerous Phase” (zerohedge.com)
• Disorderly default, almost as bad as civil war (ftalphaville.ft.com)
• Germany at war over eurozone bail-out (jhaines6.wordpress.com)
• Thank you and goodnight – Grübel’s final address (ftalphaville.ft.com)
• Eurozone faces debt reality (business.financialpost.com)
• UBS Shareholders Push for Deeper Changes (online.wsj.com)
• UBS Chief Resigns Over Trading Scandal (nytimes.com)
• Eurozone crisis: there are no miracles in Greek tragedies (telegraph.co.uk)
• Eurozone members look at ‘big bang’ plan to overcome debt crisis (independent.co.uk)

Filed under EU, Libya, Politics and Government, UK · Tagged with European Central Bank, European Financial Stability Facility, Eurozone, Government, Greece, International Monetary Fund, Oswald Grübel, UBS