Asia tops biggest global school rankings
The biggest ever global school rankings have been published, with Asian countries in the top five places and African countries at the bottom.
Singapore heads the table, followed by Hong Kong, with Ghana at the bottom.
The UK is in 20th place, among higher achieving European countries, with the US in 28th.
The OECD economic think tank says the comparisons – based on test scores in 76 countries – show the link between education and economic growth.
“This is the first time we have a truly global scale of the quality of education,” said the OECD’s education director, Andreas Schleicher.
“The idea is to give more countries, rich and poor, access to comparing themselves against the world’s education leaders, to discover their relative strengths and weaknesses, and to see what the long-term economic gains from improved quality in schooling could be for them,” he said.
The top performer, Singapore, had high levels of illiteracy into the 1960s, said Mr Schleicher, showing how much progress could be made.
In the UK, the study shows about one in five youngsters leave school without reaching a basic level of education – and the OECD says that reducing this number and improving skills could add trillions of dollars to the UK economy.
“I think it’s partly a mindset, an expectation. There are plenty of examples of schools that have raised the bar dramatically,” said education minister Lord Nash.
But a leading UK head teacher, Sir Anthony Seldon, criticised such league tables as “arguably doing more harm than good”.
“They are skewing schools and national education systems away from real learning towards repetitive rote learning,” said Sir Anthony, head of Wellington College in Berkshire.
The analysis, based on test scores in maths and science, is a much wider global map of education standards than the OECD’s Pisa tests, which focus on more affluent industrialised countries.
This latest league table, ranking more than a third of the world’s nations, shows how countries such as Iran, South Africa, Peru and Thailand would appear on an international scale.
It shows once again the poor performance of the United States, slipping behind successful European countries and being overtaken by Vietnam. It also highlights the decline of Sweden, with the OECD warning last week that it had serious problems in its education system.
Figures mapped above show estimated growth in GDP over the lifetime of pupils. The figures assume that all pupils are enrolled in schools and that they achieve at least basic skills.
The rankings are based on an amalgamation of international assessments, including the OECD’s Pisa tests, the TIMSS tests run by US-based academics and TERCE tests in Latin America, putting developed and developing countries on a single scale.
The findings will be formally presented at the World Education Forum in South Korea next week, where the United Nations is to convene a conference on targets for raising global education by 2030.
‘Every student to succeed’
The top five places are all taken by Asian countries – Singapore, Hong Kong, South Korea, Taiwan and Japan.
The five lowest-ranked countries are Oman in 72nd, Morocco, Honduras, South Africa and Ghana in last spot.
“If you go to an Asian classroom you’ll find teachers who expect every student to succeed. There’s a lot of rigour, a lot of focus and coherence,” says Mr Schleicher.
“These countries are also very good at attracting the most talented teachers in the most challenging classrooms, so that every student has access to excellent teachers.”
The report, published by the OECD and written by Eric Hanushek from Stanford University and Ludger Woessmann from Munich University, argues that the standard of education is a “powerful predictor of the wealth that countries will produce in the long run”.
“Poor education policies and practices leave many countries in what amounts to a permanent state of economic recession,” says the report.
Improving education would produce “long-term economic gains that are going to be phenomenal”, says Mr Schleicher.
If Ghana, the lowest ranked country, achieved basic skills for all its 15-year-olds, the report says that it would expand its current GDP by 38 times, over the lifetime of today’s youngsters.
Only a minority of countries in Africa had sufficient test data to be included in these rankings – and it could be that countries such as Ghana are among the higher achievers in the continent, performing better than the majority for which there are no comparable figures.
The report will provide evidence for next week’s World Education Forum of how achieving education targets can deliver economic gains.
The milestone conference, under the auspices of the United Nations, will mark 15 years since the setting of education targets by world leaders.
These millennium targets for education, such as providing all children with a primary education, have not been fully achieved.
But the World Education Forum will set another round of global targets for the next 15 years.
|Countries ranked on maths and science|
|2. Hong Kong|
|3. South Korea|
|4. Japan (joint)|
|4. Taiwan (joint)|
|17. New Zealand|
|20. United Kingdom|
|21. Czech Republic|
|28. Italy (joint)|
|28. United States (joint)|
|37. Slovak Republic|
|53. Costa Rica|
|66. Saudi Arabia|
|75. South Africa|
International Women’s Day
|International Women’s Day|
|Poster for Women’s Day, March 8, 1914|
|Significance||Civil awareness day Women and girls day Anti-sexism day Positive Discrimination Day|
|Date||March 8 (annually)|
|Related to||Mother’s Day, Universal Children’s Day, International Men’s Day|
|Part of a series on|
International Women’s Day (IWD), originally called International Working Women’s Day, is marked on March 8 every year. In different regions the focus of the celebrations ranges from general celebration of respect, appreciation and love towards women to a celebration for women’s economic, political and social achievements. Started as a Socialist political event, the holiday blended in the culture of many countries, primarily Eastern Europe, Russia, and the former Soviet bloc. In some regions, the day lost its political flavor, and became simply an occasion for men to express their love for women in a way somewhat similar to a mixture ofMother’s Day and Valentine’s Day. In other regions, however, the political and human rights theme designated by the United Nations runs strong, and political and social awareness of the struggles of women worldwide are brought out and examined in a hopeful manner.
The first national Women’s Day was observed on 28 February 1909 in the United States following a declaration by the Socialist Party of America. In August 1910, an International Women’s Conference was organized to precede the general meeting of the Socialist Second International in Copenhagen. Inspired in part by the American socialists, German Socialist Luise Zietz proposed the establishment of an annual ‘International Woman’s Day’ (singular) and was seconded by fellow socialist and later communist leader Clara Zetkin, although no date was specified at that conference. Delegates (100 women from 17 countries) agreed with the idea as a strategy to promote equal rights, including suffrage, for women. The following year, on 18 March 1911, IWD was marked for the first time, by over a million people in Austria,Denmark, Germany and Switzerland. In the Austro-Hungarian Empire alone, there were 300 demonstrations. In Vienna, women paraded on the Ringstrasse and carried banners honouring the martyrs of the Paris Commune. Women demanded that women be given the right to vote and to hold public office. They also protested against employment sex discrimination. Americans continued to celebrate National Women’s Day on the last Sunday in February.
Female members of the AustralianBuilders Labourers Federation march on International Women’s Day 1975 in Sydney
In 1913 Russian women observed their first International Women’s Day on the last Sunday in February (by Julian calendar then used in Russia). In 1917 demonstrations marking International Women’s Day in Saint Petersburg on the last Sunday in February (which fell on 8 March on theGregorian calendar) initiated the February Revolution.
Following the October Revolution, the Bolshevik Alexandra Kollontai persuaded Vladimir Lenin to make it an official holiday in the Soviet Union, and it was established, but was a working day until 1965. On May 8, 1965 by the decree of the USSR Presidium of the Supreme Soviet International Women’s Day was declared a non-working day in the USSR “in commemoration of the outstanding merits of Soviet women in communistic construction, in the defense of their Fatherland during the Great Patriotic War, in their heroism and selflessness at the front and in the rear, and also marking the great contribution of women to strengthening friendship between peoples, and the struggle for peace. But still, women’s day must be celebrated as are other holidays.”
From its official adoption in Russia following the Soviet Revolution in 1917 the holiday was predominantly celebrated in communist and socialist countries. It was celebrated by the communists in China from 1922, and by Spanish communists from 1936. After the founding of thePeople’s Republic of China on October 1, 1949 the state council proclaimed on December 23 that March 8 would be made an official holiday with women in China given a half-day off, though today’s young women in college or before motherhood are increasingly reluctant to celebrate it for the suggestion of the term ‘women’ of youth ended, prettiness lost, and relational liberty restricted.
In the West, International Women’s Day was first observed as a popular event after 1977 when the United Nations General Assembly invited member states to proclaim March 8 as the UN Day for women’s rights and world peace.
Hugo Chavez Died at 58
Hugo Rafael Chávez Frías 28 July 1954 – 5 March 2013) was the President of Venezuela, having held that position from 1999 until his death in 2013. He was formerly the leader of the Fifth Republic Movement political party from its foundation in 1997 until 2007, when he became the leader of the United Socialist Party of Venezuela (PSUV). Following his own political ideology of Bolivarianism and “socialism of the 21st century”, he focused on implementing socialist reforms in the country as a part of a social project known as the Bolivarian Revolution, which has seen the implementation of a new constitution, participatory democratic councils, the nationalization of several key industries, increased government funding of health care and education, and significant reductions in poverty, according to government figures.
Born into a working-class family in Sabaneta, Barinas, Chávez became a career military officer, and after becoming dissatisfied with the Venezuelan political system, he founded the secretiveRevolutionary Bolivarian Movement-200 (MBR-200) in the early 1980s to work towards overthrowing it. Chávez led the MBR-200 in an unsuccessful coup d’état against the Democratic Action government of President Carlos Andrés Pérez in 1992, for which he was imprisoned. Released from prison after two years, he founded a social democratic political party, the Fifth Republic Movement, and was elected president of Venezuela in 1998. He subsequently introduced a new constitution which increased rights for marginalized groups and altered the structure of Venezuelan government, and was re-elected in 2000. During his second presidential term, he introduced a system of Bolivarian Missions, Communal Councils and worker-managed cooperatives, as well as a program of land reform, whilst also nationalizing various key industries. On 7 October 2012, Chávez won his country’s presidential election for a fourth time, defeating Henrique Capriles, and was elected for another six-year term.
Chávez described his policies to be anti-imperialist, and he was a vocal critic of neoliberalismand laissez-faire capitalism. More generally, Chávez was a prominent adversary of the United States’ foreign policy. Allying himself strongly with the Communist governments of Fidel and then Raúl Castro in Cuba and the Socialist governments of Evo Morales in Bolivia, Rafael Correa in Ecuador, and Daniel Ortega in Nicaragua, his presidency was seen as a part of the socialist “pink tide” sweeping Latin America. He supported Latin American and Caribbean cooperation and was instrumental in setting up the pan-regional Union of South American Nations, the Bolivarian Alliance for the Americas, the Bank of the South, and the regional television network TeleSur. Chávez was a highly controversial and divisive figure both at home and abroad.
On 30 June 2011, Chávez stated that he was recovering from an operation to remove an abscessed tumor with cancerous cells. He required a second operation in December 2012.He was to have been sworn in on 10 January 2013, but the National Assembly of Venezuela agreed to postpone the inauguration to allow him time to recuperate and return from a third medical treatment trip to Cuba. Chávez died on 5 March 2013, at the age of 58.
Clinton says US will ease import ban on Burma goods
Secretary of State Hillary Clinton says the US will ease its import ban on goods from Burma, a key part of remaining US sanctions.
Mrs Clinton announced the move during talks with Burmese President Thein Sein at the United Nations General Assembly.
She said the move – the latest in a series – recognised “continued progress toward reform” in Burma.
Earlier, the speaker of Burma’s parliament told the BBC that his country’s reforms were “irreversible”.
Shwe Mann, a powerful figure who recently had US sanctions against him lifted, said the government intends to establish a multi-party democratic system and market economy.
Then Sein – the former top general who now leads a nominally civilian government following elections in November 2010 – is due to speak at the UN General Assembly on Thursday.
Under his administration many political prisoners have been freed and censorship eased. The Aung San Suu Kyi-led opposition is now part of the political process and holds a small number of seats in parliament.
“Our reforms are irreversible – our goal is still to build a multi-party democratic system and a market economy”
Shwe MannSpeaker, Burma
“In recognition of the continued progress toward reform and in response to requests from both the government and the opposition, the United States is taking the next step in normalising our commercial relationship,” Mrs Clinton told the Burmese president.
She said she hoped the move would give Burmese people more opportunities to sell to the US market.
Thein Sein said he appreciated the move – which is the latest in a series of such steps since the process of reform in Burma got under way. The US lifted a ban on investment in Burma in June.
Both the president and opposition leader Aung San Suu Kyi are currently in the US. Earlier this month, Ms Suu Kyi – who spent years under house arrest – received a top honour, the Congressional Gold Medal. She had also called for the sanctions to be eased.
Mrs Clinton said consultation on additional steps would continue. Thein Sein still faces opposition within Burma’s military to political reform, observers say.
But Shwe Mann, the Burmese speaker, described a good working relationship with Ms Suu Kyi.
Speaking to the BBC in Singapore, he said: “She is not my enemy, and I am sure I am not hers. She has good qualities and she loves her country. We share the same ambition – to serve the nation and people.”
Shwe Mann is now playing a central role in mapping out the future – and is widely viewed as a likely presidential candidate, says the BBC’s South East Asia correspondent Jonathan Head.
CORRUPTION PERCEPTIONS INDEX 2011
DEMANDS FOR BETTER GOVERNMENT MUST BE HEEDED
Public outcry at corruption, impunity and economic instability sent shockwaves around the world in 2011. Protests in many countries quickly spread to unite people from all parts of society. Their backgrounds may be diverse, but their message is the same: more transparency and accountability is needed from our leaders.
The 2011 Corruption Perceptions Index shows that public frustration is well founded. No region or country in the world is immune to the damages of corruption, the vast majority of the 183 countries and territories assessed score below five on a scale of 0 (highly corrupt) to 10 (very clean.) New Zealand, Denmark and Finland top the list, while North Korea and Somalia are at the bottom.
The Corruption Perceptions Index ranks countries and territories according to their perceived levels of public sector corruption. It is an aggregate indicator that combines different sources of information about corruption, making it possible to compare countries.
The 2011 index draws on assessments and opinion surveys carried out by independent and reputable institutions. These surveys and assessments include questions related to the bribery of public officials, kickbacks in public procurement, embezzlement of public funds, and the effectiveness of public sector anti-corruption efforts. Perceptions are used because corruption is to a great extent a hidden activity that is difficult to measure. Over time, perceptions have proved to be a reliable estimate of corruption.
“This year we have seen corruption on protestors’ banners be they rich or poor. Whether in a Europe hit by debt crisis or an Arab world starting a new political era, leaders must heed the demands for better government,” said Huguette Labelle, Chair of Transparency International.
Public sector governance that puts the interests of its citizens first is a responsibility that transcends borders. Governments must act accordingly. For their part, citizens need to continue demanding better performance from their leaders.
If we work together, the situation shown by this year’s Corruption Perceptions Index can improve. These are our countries and our future.
FULL TABLE AND RANKINGS
The Corruption Perceptions Index ranks countries/territories based on how corrupt their public sector is perceived to be. A country/territory’s score indicates the perceived level of public sector corruption on a scale of 0 – 10, where 0 means that a country is perceived as highly corrupt and 10 means that a country is perceived as very clean. A country’s rank indicates its position relative to the other countries/territories included in the index.
Global income inequality: Where the U.S. ranks
NEW YORK (CNNMoney) — It’s no surprise that top earners in America make a heck of a lot more than middle- and lower-income Joes.
But the disparity is greater here than in most developed nations.
The U.S. has a higher level of income inequality than Europe, as well as Canada, Australia and South Korea, according to data gathered by the World Bank.
And, while many nations have seen income inequality rise within their borders, the United States has experienced a more rapid increase in recent decades, widening the wealth gap even more.
“The top 1% in the U.S. really receive much more than in Western European countries,” said Branko Milanovic, an economist with the World Bank and author of “The Haves and the Have-Nots.”
America ranks in the bottom third of the list of 90 countries that Milanovic compiled, which is mainly based on 2008 data of per capita income or consumption in each nation.
The data is then put into a complex formula to provide the Gini index, which determines how much money would have to be redistributed for everyone to have the same income. The higher the figure, which ranges between 0 and 100, the more unequal the country.
Slovenia and the Slovak Republic top the global list, reflecting the fact that they have the most equal economies. Most of Western Europe, Canada, South Korea and Australia rank in the top half.
Faces of poverty
But while the U.S ranks low among rich nations, plenty of countries are worse off, particularly in Latin America. Honduras and Guatemala have the most income inequality, according to the World Bank.
Income inequality has also soared in the former Communist countries of Russia and China, as they shifted to market economies. Russia is only slightly better than the U.S., while China has become more unequal.
But the U.S. still stands out as a developed economy with such a great divide between rich and poor. The reasons behind its weak showing on the global stage are many and experts differ over which factors predominate.
Technology has contributed to the growing gap. As jobs require greater skills, it’s harder for those with just a high school diploma to land good-paying employment. A college degree has become a requirement for more lucrative positions.
At the same time, increased globalization is squeezing the middle class. Many companies are outsourcing jobs to other countries where workers are paid less. Also, other nations produce goods at cheaper prices so fewer U.S. firms are making items here. Hence, there are fewer opportunities to make a decent wage.
And what’s unique to the United States is the relative lack of government support compared to Europe and Canada. Other countries provide more public services, including health insurance, higher education, daycare and pensions. And these benefits are provided on a more universal basis, rather than being dependent on one’s income level, as in the United States.
“The U.S. government has done far less to address inequality in American society than any other of the rich countries,” said Frederick Solt, an assistant political science professor at Southern Illinois University at Carbondale.
Other factors also play a role in the widening divide in America.
Low-skilled immigrants to the U.S. increase the competition for low-wage jobs, said Lane Kenworthy, a sociology professor at the University of Arizona. This allows employers to keep a lid on wages.
At the same time, unions are losing their strength on this side of the pond, while they’ve retained more of their clout in Western Europe. Experts cite the decline of U.S. unions as one cause behind falling middle-class incomes.
Meanwhile, Europe also places more restraints on executive compensation so its corporate leaders don’t receive the outsized packages that their American counterparts do. Lavish executive pay is one reason why the top 1% of U.S. earners have seen their average inflation-adjusted household incomes rise by 275%, according to the Congressional Budget Office.
Growing income inequality could lead some Americans to feel that they will never be able to move up the economic ladder, experts said. This is especially true if they see the wealthy advance, while they stay in place or fall behind.
“When you combine stagnant or worsening living standards with rising income inequality, it’s a recipe for potential discouragement or frustration,” Kenworthy said.
Poverty rate rises under alternate Census measure
NEW YORK (CNNMoney) — There were more than 49 million Americans living in poverty in 2010, under an alternative measure released by the Census Bureau Monday.
That’s 16% of the nation, higher than the official poverty rate of 15.2%. Theofficial rate, released in September, showed 46.6 million people living in poverty.
The Census Bureau’s first supplemental poverty measure includes various government benefits and expenses not captured by the official poverty rate, which will continue to be used to determine eligibility for public assistance and federal funding distribution. The alternative calculation also takes into account geographic differences in prices.
Acting on recommendations from the National Academy of Sciences, the Census Bureau designed the new measure to capture the impact of many forms of non-cash public assistance, such as food stamps, housing subsidies and energy assistance.
“The main driving force behind this measure was to give policy makers a handle of the effectiveness of poverty [programs],” said Kathleen Short, an economist with the Census Bureau.
Non-cash government aid, as well as the earned income tax credit, lowered the poverty rate for recipients by as much as 2 percentage points.
Six temporary safety net programs that originated in the 2009 stimulus act helped keep 7 million people out of poverty, said Arloc Sherman, a senior researcher at the Center on Budget and Policy Priorities, citing the new Census report. These include three new or expanded tax credits, two enhancements of unemployment insurance, and expanded food stamp benefits.
The Census Bureau analysis shows how important it is to maintain the funding of these aid programs, which are currently facing the budget knife as Congress seeks to reduce the deficit, said Ron Haskins, senior fellow at The Brookings Institution.
“The lead story should be that government programs are effective in reducing poverty,” Haskins said.
On the other hand, expenses such as income and payroll taxes, work-related expenses such as transportation and child care, and medical costs increased the poverty rate by as much as 3.3 percentage points.
Who is affected: The new measure had a major impact on poverty rates among the elderly, in part because they have large medical expenses. While Social Security keeps many of them just over the poverty line, health care costs can easily pull them under, Short said. Some 15.9% of senior citizens are considered poor, up from 9% under the official rate.
Fewer children, however, are living in poverty under the supplemental measure because they benefit from many government assistance programs and the earned income tax credit. The level drops to 18.2%, down from 22.5%.
The new measure found that energy assistance and the WIC health and nutrition program for women, infants and children had little impact on the poverty rate, decreasing it by only 0.1%. Child support payments also had a minimal effect, lowering the rate by the same amount.
Under the new measure, the poverty rate among blacks fell to 25.4%, down from 27.5%. But more whites, Asians and Hispanics are impoverished.
Renters experience a small drop in poverty, while homeowners see their poverty rates increase, regardless of whether they have a mortgage.
Where they live: Americans who live in metropolitan areas have higher poverty rates under the supplemental measure, while the opposite occurs for those who lives outside of them. That’s partially because the new report adjusts for geographical differences in prices.
Likewise, the northeast and the west, which have higher living costs, see their poverty rates jump, while the midwest and the south find their rates drop a bit.
Under the new measure, the poverty threshold for a family with two adults and two children in 2010 was $24,343, while the official threshold is $22,113.
Both the official and supplemental measure show the impact of the Great Recession on the poor. The poverty rate soared to its highest level since 1993 under the official calculation. The supplemental measure, meanwhile, showed poverty increasing to 16% of the population, up from 15.3% in 2009.
When presenting the official poverty rate statistics on Monday, Census officials used a broader group than the official rates published in September. This week’s data include unrelated individuals under age 15, which pushes up the figures slightly.
Google+ social network lets firms have their own pages
Google has started allowing businesses and brands to set up their own pages on its new social network.
The US firm says the Google+ Pages facility will help companies and campaigns engage with their audience.
Organisations will not be charged to use the scheme and Google says it will not put adverts on their pages.
It is a further challenge to rival network Facebook, which offers its own Pages service allowing businesses to promote themselves.
Burberry, Barcelona football club and the Muppets are some of the organisations taking part in the launch.
Google says the service offers more than a shop window.
It says organisations can benefit from adding a “+” link to one of the adverts listed on the firm’s results or to another marketing campaign. The page owners can then monitor how many people are clicking through to their Google+ page and where they clicked from.
However, Google says it will not pass on individual IP addresses or any other personal data.
Organisations will be able to use the site’s Circles facility to match different information to different groups. They can also set up video chats with up to nine other users using the network’s Hangouts service.
“Companies like being on social networks, it allows them to have a two-way conversation with their customers and get to know more about who they are,” said Professor Jeremy Baker from the ESCP Europe Business School.
“It’s a very persuasive and intimate atmosphere as the sites are seen as trusted places to be.”
Google says more than 40 million people have already opened an account with its network
“Facebook still has more than 10 times the number of users,” said Ian Maude, head of internet at Enders Analysis.
“Google+ is growing very quickly. However, there is an awful long way for it to go before it becomes a major threat to Mark Zuckerberg’s business.”
China to inject over $158 billion into money market: report
SHANGHAI (Reuters) – China is likely to inject more than 1 trillion yuan ($158 billion) into the money market in the next two months via annual subsidies from the Ministry of Finance, the official China Securities Journal on Monday quoted a research report as saying.
The injection will help improve liquidity, which has been impacted by the government’s tight monetary policy in place since October last year, the newspaper quoted the report by China International Capital Corp (CICC) as saying.
The Finance Ministry typically offers subsidies to various industries and sectors in the last two months of each year as part of distribution of the government’s annual tax income.
The ministry does not publicize these subsidies but the market estimated they totaled 1 trillion-2 trillion yuan in 2010.
The People’s Bank of China (PBOC) has not raised interest rates or bank reserve requirement ratios (RRR) since July in a sign that the government may be considering loosening its tight monetary stance amid the market turmoil sparked by the euro zone debt crisis.
The central bank previously instituted a slew of rate and RRR hikes as inflation repeatedly hit three-year highs.
Those steps offset the impact of liquidity injections via Finance Ministry subsidies late last year, but the market widely expects the PBOC will leave the subsidies to improve market liquidity this year, traders have said.
(Reporting by Lu Jianxin and Carrie Ho; Editing by Jonathan Hopfner)
AIG posts $4.1 billion loss
The bailed out insurer posted a net loss of $4.1 billion on Thursday, a loss per share of $2.16 for the third quarter. While analysts hadn’t expected the company to post a profit, the size of the loss exceeded expectations.http://ads.cnn.com/html.ng/site=cnn_money&cnn_money_position=220x200_ctr&cnn_money_rollup=business_news&cnn_money_section=quigo&page.allowcompete=no¶ms.styles=fs&page.allowcompete=yes&tile=1320376423319&page.allowcompete=yes&domId=274798
The outsized loss sent AIG (AIG,Fortune 500) shares lower after the closing bell, with prices dropping more than 1% to $24.35.
And that’s bad news for taxpayers, since the U.S. Treasury still owns a substantial chunk of AIG.
Back in 2008, the government agreed to help the giant insurer get back on its feet with a $180 billion lifeline. AIG has been slowly working toward paying back that loan.
But declining profits, and a recent drop in share price make that a much tougher task.
If the government is to be made whole, AIG will have to find a way to boost its share price. Shares now sit well below $28.72 — the breakeven point for Treasury’s investment.
Separately, AIG announced Thursday that its board of directors had authorized a $1 billion share buyback, a sign the company views its stock as undervalued.
AIG stock’s slide may hurt taxpayers
AIG CEO Robert Benmosche attributed the loss to a tough business environment.
“AIG continues to navigate a challenging global economic environment, and our results for the quarter were adversely affected by equity market declines, widening credit spreads, and declining interest rates, as well as property catastrophe losses,” Benmosche said in a statement.
The company’s bottom line suffered from a $1.5 billion impairment charge in its aircraft leasing division, and AIG was hit by the declining value of its stake in Asian insurer AIA.
Last quarter, the company reported net income of $1.8 billion — a rare profit.
Your phone company is selling your personal data
NEW YORK (CNNMoney) — Your phone company knows where you live, what websites you visit, what apps you download, what videos you like to watch, and even where you are. Now, some have begun selling that valuable information to the highest bidder.
That kind of data could be very useful — and lucrative — to third-party companies. For instance, if a small business owner wanted to figure out the best place to open a new pet store, the owner could buy a marketing report from Verizon about a designated area. The report might reveal which city blocks get the most foot or car traffic from people whose Web browsing history reveals that they own pets.
Verizon (VZ, Fortune 500) is the first mobile provider to publicly confirm that it is actually selling information gleaned from its customers directly to businesses. But it’s hardly alone in using data about its subscribers to make extra cash.
All four national carriers use aggregated customer information to help outside parties target ads to their subscribers. AT&T, Sprint and T-Mobile insist that subscriber data is never actually handed over to third-party vendors; nevertheless, they all make money on it.
AT&T’s (T, Fortune 500) AdWorks program, for instance, promotes AT&T’s customer base to advertisers. On its AdWorks website, AT&T touts its ability to “reach customized audience segments based on anonymous and aggregate demographics.” It then shows customers carefully tailored coupons, in-app ads and Web ads.
Sprint (S, Fortune 500), like Verizon, tracks the kinds of websites a customer visits on their mobile devices as well as what applications they use, according to spokesman Jason Gertzen. Sprint uses that data to help third parties target ads to customers.
That’s a step further than Verizon goes. It too lets advertisers target customized messages to Verizon subscribers’ mobile phones, but for that initiative, it does not incorporate its customers’ Web surfing or location data, according to a company spokesman. Verizon relies on other personal information, including customers’ demographic details and home address.
Selling customer information is an age-old practice that is certainly not exclusive to the wireless industry. Brian Kennish, a former DoubleClick engineer who developed the advertising network’s mobile ad server, noted that wireless companies have been sharing users’ location data with third parties for more than a decade.
But the rise of smartphones has given mobile providers an accidental treasure trove of marketable data: The gadgets are hyper-personalized tracking devices that “know” more about their owners than any other product on the market.
Wireless providers are taking advantage of their gold mine.
“At the end of the day, we’re getting to a situation where customers are the products that these wireless companies are selling,” said Nasir Memon, a professor of computer science at New York University’s Polytechnic Institute. “They’re creating a playground to attract people and sell them to advertisers. People are their new business.”
There’s a lot of money to be made in the largely untapped local advertising markets. A BIA/Kelsey study from March predicts that U.S. local online ad revenues will reach $42.5 billion annually in 2015.
Google (GOOG, Fortune 500) and Facebook are scrambling to sign local businesses to their new services like Facebook Places, Google Wallet and Google Places. But with smartphone customer data in their arsenal, wireless carriers are well positioned to swoop in as well.
“Verizon revealed the industry’s strategy,” said Jeff Chester, executive director of the Center for Digital Democracy. “This is more than the camel’s nose under the tent. With NFC [near field communication, an emerging technology for mobile payments] and GPS, there’s a new digital gold rush here, and wireless companies want to reap the tremendous financial rewards that will come with dominating a local advertising market.”
Chester noted that Verizon was the first to admit that it’s selling customer data for local advertising and business-development purposes, but he said he believes all of the industry’s players are involved in using subscriber information for that purpose.
“They’re all doing this,” he said. “Everyone is aware that big growth in the digital economy is mobile and location-based services.”
For its part, Verizon has largely been applauded by privacy groups for at least being transparent about what it’s doing and pointing users to an opt-out site if they don’t wish to participate. But privacy advocates are concerned about the direction wireless companies are headed.
“The Web pages we go to and searches we do are the closest thing to our thoughts, the most private info of all, that can be recorded,” said Kennish, who now heads up Disconnect, an online privacy tool. “If Verizon succeeds, I’m sure others will follow. Despite all the talk about privacy lately, things are just getting worse.”
Greek cabinet backs George Papandreou’s referendum plan
Greece’s cabinet has given unanimous backing to a controversial plan by PM George Papandreou to hold a referendum on a EU debt rescue package.
He told an emergency cabinet meeting that a referendum would offer “a clear mandate” for austerity measures demanded by other eurozone members.
Stock markets recorded big drops amid shocked reactions in eurozone capitals to the referendum announcement.
Mr Papandreou is due to meet European leaders in France on Wednesday.
In a cabinet meeting lasting late into Tuesday night, Mr Papandreou told ministers the government needed the consent of the Greek people.
In a statement released by his office, he said: “The referendum will be a clear mandate and a clear message in and outside Greece on our European course and participation in the euro.”
Mr Papandreou also said a possible alternative of snap elections would risk Greece defaulting on its debt.
The Greek government faces a crucial confidence vote in parliament on Friday.
Following the seven-hour meeting, government spokesman Elias Mossialos said: “The cabinet expressed its support.”
“The referendum will take place as soon as possible, right after the basics of the bailout deal are formulated,” he added.
Monday’s referendum announcement led to sharp falls on world markets on Tuesday. Asian markets also continued their slide on Wednesday.
The planned referendum threatened to unravel a deal reached at a EU summit last week aimed at resolving the euro debt crisis.
Leaders agreed on a 100bn-euro loan (£86bn; $140bn) to Athens and a 50% debt write-off.
But in return, Greece must make deep cuts in public spending, slashing pensions and wages and making thousands of civil servants redundant.
There have widespread protests in Greece against the measures.
On Tuesday President Nicolas Sarkozy of France said Mr Papandreou’s decision “surprised all of Europe”.
The French and German governments said they wanted “full implementation” of the agreement “in the quickest time frame”.
Mr Papandreou is to hold hastily arranged talks on Wednesday with Mr Sarkozy and German Chancellor Angela Merkel, on the sidelines of a G20 summit in France.
Continue reading the main story
Latest planned austerity measures
- New pay and promotion system covering all 700,000 civil servants
- Further cuts in public sector wages and many bonuses scrapped
- Some 30,000 public sector workers suspended, wages cut to 60% and face lay off after a year
- Wage bargaining suspended
- Monthly pensions above 1,000 euros to be cut 20% above that threshold
- Other cuts in pensions and lump-sum retirement pay
- Tax-free threshold lowered to 5,000 euros a year from 8,000
- Austerity plans in full
- How to solve eurozone crisis
In a joint statement, President Sarkozy and Chancellor Merkel said the decisions taken by last week’s EU summit were “more necessary than ever”.
“France and Germany are convinced that this agreement will allow Greece to return to sustainable growth,” they said.
Last week’s marathon EU summit was intended to rescue Greece and bringing the 17-nation eurozone back from the brink of disaster.
Eurozone chief Jean-Claude Juncker said if a referendum rejected the bailout, it could mean bankruptcy for Greece.
“It will depend on the manner in which the question will be exactly formulated and on what the Greeks exactly vote on,” he said.
Some Greek government ministers had been unaware of the referendum plan until it was announced.
The announcement even took Greece’s Finance Minister Evangelos Venizelos by surprise, Greek media reported.
One MP from the governing Pasok party has resigned, cutting Mr Papandreou’s parliament majority to two ahead of Friday’s confidence vote.
Six other leading party members have called on him to resign.
The Greek opposition has called for early elections, saying the referendum jeopardises Greece’s EU membership.
Antonis Samaras, leader of the main opposition New Democrats, said: “In order to save himself, Mr Papandreou has posed a dilemma of blackmail that puts our future and our position in Europe in danger.”
BT fibre broadband cable UK rollout accelerated
Telecoms provider BT is accelerating its fibre broadband rollout. It now plans to offer “super-fast” internet speeds to two-thirds of UK premises by the end of 2014.
The target is a year ahead of its original plan.
The firm says its main product will offer maximum download speeds about 10 times faster than at present, at 70-100Mbps on average.
That will help it compete against Virgin Media’s 100Mbps offer.
BT says it is employing an additional 520 engineers and bringing forward £300m of investment to achieve the goal.
The company says six million premises already have access to its fibre broadband technology, about 25% of the total.
It aims to increase that to about 10 million properties, or about 40% of those in the UK, by the end of next year.
“Our rollout of fibre broadband is one of the fastest in the world and so it is great to be ahead of what was an already challenging schedule,” said BT’s chief executive Ian Livingston.
A recent report suggested the UK ranked 25th in the world in terms of average broadband connection speeds.
Akamai’s State of the Internet Report said the average UK connection speed was 5Mbps compared to the Netherlands’ 8.5Mbps and South Korea’s 13.8Mbps.
“For a long time people thought the UK was on a low-fibre diet and it was taking us a long time compared to everyone else,” said Matthew Howett, senior analyst at the telecoms consultants Ovum.
“These investments are expensive and risky – especially when you don’t know if people even want the faster product. But BT has seen demand for its top speeds and that’s encouraging them to roll out the fibre more quickly.”
Speeds of up to 100Mbps will allow households to stream multiple high definition television programmes, music and games at the same time.
Experts say most homes will not need such fast speeds for the foreseeable future, however it will help future-proof the network against further developments.
Apple and Microsoft file patents for touchless controls
Apple and Microsoft are involved in a new patent race over touchless gesture-controls.
Recently released patent filings reveal new ways to control devices that do not involve physical contact.
Microsoft describes waving one’s hands to “draw” three-dimensional objects on a computer, while Apple’s designs involve allowing users to “throw” content from one device to another.
Securing patent rights allows the firms to claim ownership of the technologies.
They could then prevent others from using the same gesture controls, or charge them a licence.
The two technology firms are not the only ones exploring the area. Less well known companies, including Qualcomm and Extreme Reality 3D, have also acted to secure touchless control patent rights.
“It’s interesting that so many companies are actually investing some very serious time and money into it,” said Chris Green, a technology analyst at Davies Murphy Group.
“But the jury is still out on whether this whole waving-your-hands-in-the-air will have a long term future outside computer games, and it’s still very much a work in progress.”
Continue reading the main story
No longer would users have to fiddle with complex remotes for DVD players and cable channels”
Steve JobsFormer Apple CEO
The patent applications have been made public by the US Patent and Trademark Office.
Apple’s filing, entitled “Real Time Video Process Control Using Gestures”, describes controlling images on a device, such as an iPhone, without touching it, and the ability to transfer the pictures to one of the firm’s other products using contact-free hand movements.
It suggests infrared, optical and other sensors would be used to detect the movements.
One use could be to transfer a video from a mobile phone by “flicking” it to a television.
“Say you’re browsing a TV app on your phone and you found a programme you wanted to record, you could literally – just with a wave – take that programme and throw it to the other device using a gesture rather than using a Bluetooth or cable connection,” said Mr Green.
The patent application’s release coincides with renewed speculation about Apple branded television sets.
The firm’s former chief executive, Steve Jobs, appears to have hinted at the prospect to his biographer.
Walter Issacson wrote: “He very much wanted to do for television sets what he had done for computers, music players, and phones: make them simple and elegant”.
Mr Isaacson quoted Mr Jobs as saying: “It will have the simplest user interface you could imagine. I finally cracked it.”
The book was published following Mr Jobs’ death, earlier this month.
Microsoft has already put touchless gesture technology into practice with the popular Kinect motion sensing device for its Xbox games console.
“Microsoft’s Kinect system has been widely praised for its accuracy and clarity, and even university research departments are using the Kinect devices, hacking them and using them for their projects,” said Mr Green.
Continue reading the main story
You no longer have to use a mouse to draw a shape – you can just wave your hands in the air and it’ll appear”
Chris GreenDavies Murphy Group
“But it is still fairly large, and if you’d like to apply it to a smartphone, you’d need to compress the Kinect down into something the size of your thumb.”
Microsoft’s recent filing details potential business applications for the technology.
It says it would be possible to make a gesture near a device’s surface to “draw” and manipulate virtual 3D objects.
One possible use would be for someone giving a presentation to draw a square in the air and then have it appear behind them on a screen or mid-air from a 3D projector.
“You no longer have to use a mouse to draw a shape – you can just wave your hands in the air and it’ll appear,” Mr Green explained.
“That aspect potentially has some enterprise applications in terms of computer-aided design…. but it’s still very expensive.”
Sony buys the rest of mobile phone firm Sony Ericsson
Sony boss Sir Howard Stringer: “It’s an opportunity for us to grow faster”
Japanese technology giant Sony has bought full control of mobile phone maker Sony Ericsson from Swedish telecoms equipment maker Ericsson.
Sony has agreed to buy 50% of the firm for 1.1bn euros ($1.5bn; £964m), making the mobile handset business a wholly-owned subsidiary of Sony.
Ericsson said that the “synergies” between telecoms equipment and mobile phones were decreasing.
The transaction also includes a patent deal.
Sony will get the five sets of patents that are essential to making the phones and a licensing agreement on any other intellectual property.
Many observers expected this deal because Sony wanted to integrate its phone division with its mobile games machine and tablet computer units.
“This acquisition makes sense for Sony and Ericsson, and it will make the difference for consumers, who want to connect with content wherever they are, whenever they want,” said Sony’s chairman Sir Howard Stringer.
Earlier this month, Sony Ericsson broke even in its third quarter and announced it would focus on smartphones from 2012.
The company said its Xperia smartphones accounted for 80% of its sales. The handsets run Google’s Android operating system.
Analysts said Sony had proved resistant to sharing its brands and other assets with the joint venture, explaining why it took until this year for PlayStation games to be offered on any of its handsets.
Nokia bets on Windows Phone future
Finnish mobile phone maker Nokia has launched two new smartphones based on Microsoft’s new Windows Phone 7.5 operating system.
The Lumia 800 and the Lumia 710 mark the beginning of Nokia’s fightback against Apple’s iPhone and rivals using Google’s Android software.
Nokia’s new boss, Stephen Elop, had previously warned that the company was stuck on a “burning platform”.
Today he said the launch marked the “rebirth” of Nokia.
In an unusual move for the company, it will start shipping the Lumia 800 range almost immediately and hit the shops in France, Germany, Italy, UK, Spain and the Netherlands in November.
The firm also announced four new basic phones.
Rory Cellan-Jones looks at Nokia’s new Lumia 800 smartphone
The brightly coloured handsets are pitched at developing countries.
Mr Elop said the phones would blur the boundaries between feature phones and smart phones, bringing the internet “to the next billion people”.
The new range will be called Asha, a name that clearly identifies Nokia’s target market: the name is derived from the Hindi word for “hope”.
Although the phones will be relatively cheap, they will sport features like touch screens, 5 mega pixel cameras, bright screens, 32GB storage for music and long battery life.
Profit margins in the market for basic phones are razor thin, and so Nokia’s main focus will be on its new smartphones.
Until recently, the company was the world’s largest maker of smartphones.
However, its market share has been falling rapidly, and in one of his first moves after taking over at Nokia a year ago, Mr Elop ditched Nokia’s two operating systems for phones – the venerable Symbian and the Linux-based MeeGo – and struck a broad alliance with Microsoft.
The question is will Indian and Chinese consumers continue to want Nokia phones if they are shunned by American and European buyers?”
Now Microsoft’s new Windows Phone 7.5 operating system, also dubbed Mango, will power all Nokia’s smartphones.
Mr Elop acknowledged that the Lumia 800 was a design development of a previous Nokia phone, the MeeGo-based N9.
Mr Elop said the “Lumia is the first real Windows phone” and predicted the company would be the leader in “smartphone design and craftsmanship”.
The Lumia 710, which comes in a range of funky colours, will be pitched as the “affordable” Windows phone.
The phone’s product manager, Kevin Shiels, said the new phones would have integrated cameras with high-end Carl Zeiss lenses.
In an explicit dig at Apple’s iPhones, he demonstrated how Windows Phone shows information and updates directly on the first screen, without having to tap into applications.
Speaking at the Nokia World congress, Mr Elop said Nokia had “some tough decisions to make, but [we] have started to deliver some early results”.
Nokia had been seen as “reliable, trustworthy”, like a mother that will “comb your hair… but that’s not good enough,” he said.
“We expect people to see something special when they hear Nokia,” said Mr Elop.
To distinguish itself from other makers of Windows phones like HTC, Samsung and LG, Nokia is betting on a range of services.
The BBC’s Rory Cellan-Jones interviews Nokia boss Stephen Elop
Key among them is the integration of location-based services like Nokia Maps, real-time navigation software Nokia Drive, a live-streaming music service Mix Radio and Liveview, an augmented reality service.
Nokia’s navigation service Drive will be free. It will not run in an app but will use HTML 5 technology, and will be updated with traffic information in real-time.
Nokia will also deliver its phones with the ESPN sports hub, which will provide free access to text and video news from ESPN.
The biggest innovation, though, could be Nokia Pulse, a service that combines elements of social networking with location services. It allows users to share with friends and family experiences – from pictures to whereabouts to activities, integrated with Nokia’s mapping service
Shortly before Mr Elop announced the switch to Microsoft Windows Phone, he sent an email to his staff, in which he compared the company to a man on a burning platform, who had the choice of burning to death or jumping into the icy waters below.
The launch of the new phones is Nokia’s splash landing. Mr Elop will hope that the new hardware and software offering will be popular enough with consumers to allow the company to swim.
But it is not just Nokia that has a lot riding on the launch of these phones.
Software giant Microsoft has been struggling for years to break into the mobile phone market. Its most recent offering, the Windows Phone 7 software, has been well received but gained little traction in the market.
The company will hope that Nokia’s close relationship with mobile phone network operators around the world will give it the access to consumers that has been lacking so far.
The Lumia launch, with 35 network operators, will be accompanied by a campaign called “The Amazing Everyday” involving viral marketing stunts.
Microsoft is reportedly supporting both Nokia and Samsung with tens of millions of dollars to advertise new Windows Phones in the market.
Boeing’s Dreamliner set for maiden commercial flight
After three years of delays, Boeing’s Dreamliner jet is set for its maiden commercial voyage.
The All Nippon Airlines (ANA) flight will take off from Tokyo around 1230 local time, bound for Hong Kong.
The Dreamliner had originally been scheduled for delivery in 2008, but Boeing has suffered a string of setbacks.
Boeing plans to make 10 of the planes a month from 2013.
Wednesday’s flight is a special charter, with normal services due to start in November.
Because of the materials used in construction, Boeing says the Dreamliner is about 20% more fuel efficient than similarly sized models flying today.
That would be a big help for airlines coping with the high cost of jet fuel, which is usually their biggest single cost.
Japan, a country in which Boeing dominates rival Airbus, is a major market for the Dreamliner.
ANA will take delivery of dozens more of the aircraft in the coming years.
But Boeing’s delays have hurt its business.
Last week, China Eastern Airlines cancelled orders for 24 Dreamliners, rather than wait for production to pick up.
Struggling Wikileaks stops publishing classified files
The whistle-blowing website Wikileaks is suspending its publication of classified files.
Wikileaks said that it would focus instead on raising funds to ensure its future survival.
The announcement came after what the group called a blockade by US-based finance companies.
This followed its disclosure on the internet of hundreds of thousands of secret US government files and diplomatic cables.
Wikileaks founder Julian Assange said that since last December an “arbitrary and unlawful financial blockade” had been imposed by Bank of America, Visa, MasterCard, PayPal and Western Union.
“The attack has destroyed 95% of our revenue,” he said.
The former computer hacker said the organisation had lost “tens of millions of dollars in lost donations at a time of unprecedented operational costs”.
“A handful of US finance companies cannot be allowed to decide how the whole world votes with its pocket,” he added.
Mr Assange said Wikileaks must “aggressively fundraise in order to fight back against this blockade and its proponents”.
He said the group was taking pre-litigation action against the blockade in Iceland, Denmark, the UK, Brussels, the United States and Australia and had lodged an anti-trust complaint at the European Commission.
A Wikileaks spokesman, Kristinn Hrafnsson said its website would reopen for submissions of confidential documents on 28 November.
Mr Assange is in Britain awaiting a decision by the High Court on the appeal against his extradition to Sweden to face sex assault charges.
After the hearing in July, judges did not give a date for their decision on Mr Assange’s bid to overturn a judgment made in February.
He fears extradition to Sweden may lead to him being sent to the United States to face separate charges relating to Wikileaks, for which he could face the death penalty.
The Australian won bail in December and has been staying at Ellingham Hall, a 10-bedroom Norfolk farmhouse owned by Vaughan Smith, director of the Frontline media club.
His bail conditions include wearing an electronic tag and daily appearances at a nearby police station.
Mr Assange describes the allegations as “without basis”.
Bank of America and Mastercard have refused to comment to the BBC.
PayPal referred the BBC to a statement issued last December which said that Wikileaks had violated its “Acceptable Use Policy”, specifically alleging that WikiLeaks was encouraging sources to release classified material, which was likely to be a violation of US law.
Visa Europe also said that merchants wanting to accept Visa payment must abide by its operating regulations and also the applicable laws in the country or countries where the cardholder and the merchant were based.
Steve Jobs vowed to ‘destroy’ Android
Steve Jobs said he wanted to destroy Android and would spend all of Apple’s money and his dying breath if that is what it took to do so.
The full extent of his animosity towards Google’s mobile operating system is revealed in a forthcoming authorised biography.
Mr Jobs told author Walter Isaacson that he viewed Android’s similarity to iOS as “grand theft”.
Apple is suing several smartphone makers which use the Android software.
According to extracts of Mr Isaacson’s book, obtained by the Associated Press, Mr Jobs said: “I’m going to destroy Android, because it’s a stolen product. I’m willing to go thermonuclear war on this.”
He is also quoted as saying: “I will spend my last dying breath if I need to, and I will spend every penny of Apple’s $40 billion [£25bn] in the bank, to right this wrong.”
Apple enjoyed a close relationship with Google prior to the launch of the Android system. Google products, including maps and search formed a key part of the iPhone’s ecosystem.
I’m going to destroy Android, because it’s a stolen product. I’m willing to go thermonuclear war on this.”
Steve JobsApple co-founder
At that time, Google’s chief executive, now chairman, Eric Schmidt also sat on the board of Apple.
However, relations began to sour when Google unveiled Android in November 2007, 10 months after the iPhone first appeared.
In subsequent years, Apple rejected a number of Google programs from its App store, forcing the company to create less-integrated web app versions.
Android has subsequently enjoyed rapid adoption and now accounts for around 48% of global smartphone shipments, compared to 19% for Apple.
But its growth has not gone uncontested. Apple has waged an aggressive proxy-war against Android, suing a number of the hardware manufacturers which have adopted it for their tablets and smartphones.
Motorola was one of the first to be targeted, although it is Samsung that has borne the brunt of Mr Jobs’ ire.
The South Korean firm is currently banned from selling its Galaxy Tab 10.1 in Australia and Germany because of a combination of patent infringements and “look and feel” similarities. A smartphone ban is also pending in the Netherlands.
Samsung is counter-suing Apple for infringing, it claims, several wireless technology patents which it holds the rights to.
Patents blogger Florian Mueller, who has been following the court cases closely, said Apple would be conscious of its past, where other companies exploited some of its early ideas.
“If Apple doesn’t want the iPhone and iPad to be marginalised the way it happened to the Macintosh at the hands of the Wintel duopoly, it has to use the full force of its intellectual property to fend off the commoditization threat that Android represents,” he told BBC News.
Mr Mueller – who has previously undertaken consulting workcommissioned by Microsoft – was also critical of Eric Schmidt’s dual role at the time: “The fact that Eric Schmidt stayed on Apple’s board while he was preparing an iOS clone was an inexcusable betrayal of Steve Jobs’ trust.”
Mr Schmidt resigned from the Apple board in August 2009. He was later quoted by Bloomberg as saying: “I was on the board until I couldn’t stay on the board anymore.”
Extra euro crisis summit called
EU leaders are to hold another summit by Wednesday, because they will not be able to agree a rescue plan for the euro on Sunday.
French President Nicolas Sarkozy and German Chancellor Angela Merkel said a crisis strategy would be discussed on Sunday and adopted at the next meeting.
EU leaders need to agree a second bailout for Greece, how to recapitalise banks and a stronger bailout fund.
President Sarkozy also called for talks with the private sector.
The private sector talks would be “to find an agreement allowing to strengthen the sustainability” of Greek debt.
Previous disagreements between France and Germany about the bailout plans have centred on how much the private sector would have to contribute to any package.
A spokesman for Chancellor Merkel said the leaders agreed that a “comprehensive, ambitious” answer to the crisis was needed.
The spokesman also said that the advantage of the additional summit would be that it would give the German parliament time to approve any changes to the bailout fund.
How do other members of the eurozone feel about this very public display by France and Germany that their respective interests and ideas are of only secondary importance?”
Chancellor Merkel had been due to address the Bundestag on Friday, but that has now been postponed.
President Sarkozy and Chancellor Merkel have also said they plan to meet on Saturday in the hope of making progress, ahead of the heads of government meeting on Sunday in Brussels.
Sunday’s summit had already been delayed from 17-18 October because more time was needed to finalise a plan.
The French and German leaders spoke on the phone on Thursday.
“We have made enormous progress but not enough to take final decisions on Friday,” Chancellor Merkel’s spokesman said.
“In certain areas, we have reached agreement, in others, we are on the right track.”
European shares fell on Thursday amid concern about whether enough progress would be made at the weekend summit.
Greece unrest: Strike to continue amid austerity vote
Protesters set fires and continued to clash with police on Wednesday evening
Greece is braced for a second day of a general strike and mass protests as parliament takes a final vote on tough new austerity measures.
Running battles between police and some protesters continued overnight in Athens after tens of thousands demonstrated against the cuts.
The measures, including tax hikes and pay cuts, are needed to convince the EU and IMF to continue bailout loans.
Greece is saddled with a huge public debt and an economy in deep recession.
The 48-hour general strike is due to continue on Thursday with workers in virtually every sector of the economy participating.
Air traffic controllers went back to work after a 12-hour stoppage on Wednesday, allowing international and domestic flights to resume.
But civil servants, shopkeepers, dock workers, taxi drivers, doctors, lawyers, teachers, construction workers and others were due to continue the industrial action.
Latest Planned Austerity Measures
- New pay and promotion system covering all 700,000 civil servants
- Further cuts in public sector wages and many bonuses scrapped
- Some 30,000 public sector workers suspended, wages cut to 60% and face lay off after a year
- Wage bargaining suspended
- Monthly pensions above 1,000 euros to be cut 20% above that threshold
- Other cuts in pensions and lump-sum retirement pay
- Tax-free threshold lowered to 5,000 euros a year from 8,000
Parliament is expected to approve the articles of an austerity bill after giving it preliminary approval in a first vote late on Wednesday by a margin of 154-141 of the 300 deputies.
‘Desperation and bitterness’
At least 100,000 people demonstrated against the measures in Athens on Wednesday. Protesters have said they will rally again on Syntagma Square in front of the parliament while the vote takes place.
The bill includes plans for further cuts to pensions and salaries and temporary lay-offs of 30,000 public sector workers.
Some of Prime Minister George Papandreou’s ruling socialist party deputies have threatened not to vote for some of the bill’s articles.
With Greece unable to borrow long term on international bond markets to finance its debt, the EU and IMF have stepped in with two bailout packages.
But they have demanded tough action to cut the deficit, which has angered many in Greece who say the medicine is killing the patient.
“We just can’t take it any more. There is desperation, anger and bitterness,” Athens area union official Nikos Anastasopoulos told Associated Press news agency.
Finance Minister Evangelos Venizelos described the choice as between a “difficult situation and a catastrophe”.
“We have to explain to all these indignant people who see their lives changing that what the country is experiencing is not the worst stage of the crisis,” he said.
“It is an anguished and necessary effort to avoid the ultimate, deepest and harshest level of the crisis.”
There are fears that if the Greek government defaults on its debts it will set off a chain reaction that could engulf banks and other highly-indebted eurozone nations.
But the government is struggling to convince lenders that it is cutting effectively enough. Greece says it needs the next 8bn euros ($11bn; £7bn) of the first bailout agreed to last year or it will soon be unable to pay its bills.
The details of the second rescue plan have yet to be finalised. Banks have agreed to take a 21% loss, or “haircut”, on their loans to Greece but there is growing pressure for them to accept higher losses.
European leaders and global finance chiefs are trying to work out a broader plan to tackle the eurozone’s debt crisis ahead of a weekend summit in Brussels.
French President Nicolas Sarkozy flew to Germany late on Wednesday to meet German Chancellor Angela Merkel and senior officials from the European Central Bank and IMF.
Neither leader gave any details about what had been discussed.
The two have disagreed about how Europe’s bailout fund, the European Financial Stability Facility (EFSF), can be leveraged from its current 440bn euros to a much higher value in order to bail out banks and struggling countries such as Italy and Spain, if needed.
Apple full year profits rise 85%
The world’s biggest technology company Apple has reported full year results, showing net profit for the year to 25 September at $25.9bn (£16.5bn), up 85% from the previous year.
Even that was not enough to satisfy Wall Street, with the shares falling nearly 5% in after-hours trading.
There was some disappointment with the fourth quarter of the year, when no major new products were released.
It is the first set of results since the death of co-founder Steve Jobs.
In the fourth quarter of the year, Apple sold 17.1 million iPhones, which was a 21% increase on the same period last year, and 11.1 million iPads, which was a 166% increase.
But analysts had been expecting iPhone sales of 20 million in the quarter.
Apple said sales were hurt in September by customers waiting for the new version, the iPhone 4S, which was released on 14 October.
It sold four million of the new models in the first three days after launch.
“The numbers came in weak. They need to set records every time they report to keep up the momentum,” said Colin Gillis, analyst at BGC Partners.
Apple sold 4.9 million Mac computers in the quarter – up 27% over the same period last year.
“The numbers are actually quite good. The reason why the stock is off – I think some of the analysts got carried away,” said Shaw Wu, analyst at Sterne Agee.
Apple sells record 4 million iPhones
NEW YORK (CNNMoney) — Apple said Monday that it has sold more than 4 million iPhone 4S smartphones since its launch three days ago, setting a sales record for the device.
Over the weekend, the company sold more than twice the 1.7 million iPhone 4s that it sold during last year’s opening weekend, though the numbers are a bit skewed: This year’s iPhone was simultaneously launched in the United States, Australia, Canada, France, Germany, Japan and the United Kingdom, while last year’s launch did not include Australia and Canada.
Also in the United States, the iPhone launched on multiple carriers for the first time. The iPhone 4S is also the first iPhone to be available on the Sprint (S, Fortune 500) network. Verizon (VZ, Fortune 500) previously sold the iPhone 4, but the device launched exclusively on AT&T (T, Fortune 500).
Apple’s (AAPL, Fortune 500) management said it was pleased with the results.
“IPhone 4S is off to a great start,” Philip Schiller, Apple’s head of marketing, said in a prepared statement. “IPhone 4S is a hit with customers around the world, and together with iOS 5 and iCloud, is the best iPhone ever.”
Apple also announced that more than 25 million customers have downloaded or purchased a device with iOS 5, the new mobile software that powers the iPhone, iPad, and iPod Touch. The latest version of the operating system became available on Oct. 12.
There were a few reported hiccups with the download last Wednesday, as Apple’s servers were overwhelmed with demand. The new iOS 5 operating system also crashed at least one popular app, Google Voice. The search giant’s phone application was pulled from the iTunes App Store this weekend after repeated reports of crashes. Google (GOOG, Fortune 500) said it has a fix in the works and plans an update soon.
The sales record comes despite a more muted turnout at Apple’s flagship store on launch day Friday, with around 250 people waiting 90 minutes before the iPhone went on sale. Some speculated that the rainy weather in New York City was to blame.
The new iPhone appears physically the same as the iPhone 4, but the guts are improved: it features a new, faster processor called the A5, which debuted in the iPad 2. It also includes a better, 8-megapixel camera, an improved antenna, and Siri, the new voice command software that’s billed as an on-board personal assistant.
Siri has already become a cult sensation, inspiring glowing reviews and blogs devoted to chronicling her more amusing quotes. She’s got opinions about the meaning of life (“42”) and the best place to hide a body (“metal foundries” and “swamps” make the list).
Philips cutting 4,500 jobs as profits fall
Struggling Dutch lighting and consumer electronics group Philips is to cut 4,500 jobs.
It made the announcement as it reported a sharp fall in third-quarter profits as a result of lower margins, falling sales and a loss at its TV division.
Its group-wide net profit for the three months to 30 September was 74m euros ($103m; £65m), compared with 524m euros a year earlier.
Philips has issued two profit warnings in the past seven months.
Meanwhile, its share price has fallen 40% over the past year, as the company struggles to compete with lower-cost Asian rivals.
Philips’ quarterly revenues declined by 1.3% to 5.4bn euros.
“We do not expect to realise a material performance improvement in the near term,” said Philips chief executive Frans van Houten.
Philips employs 116,000 people across the world, including 2,200 in the UK.
The company’s UK facilities are located in Guildford, Surrey; Hamilton, South Lanarkshire; and Chichester, West Sussex.
Of the 4,500 job cuts, 1,400 will go in the Netherlands. Where the remaining 3,100 jobs will be lost has yet to be announced.
Mr van Houten said the job cuts were “a regrettable but inevitable step to improve our operating model to become more agile, lean and competitive”.
Philips added that talks with Hong Kong-based TPV Technology over the sale of a 70% majority stake in its television business were taking “longer than expected”.
EU plan to spend billions on boosting broadband speeds
By David MeyerBerlin
The European Commission is set to propose investing almost €9.2bn (£8bn) in a massive rollout of super-fast broadband infrastructure and services across the European Union.
The plan is partly aimed at stimulating further investment in rural broadband.
It is hoped the initiative will also help to create a single market for digital public services.
The Commission has already set targets for improving the speed of home internet connections across the region.
It aims to get all European households on at least 30 megabits per second (Mbps) by 2020, with half the population enjoying more than 100Mbps, so as to make the continent more competitive and productive.
The BBC understands that the EU’s executive body will propose the funding, which would be invested between 2014 and 2020, on Wednesday.
The plan would have to be approved by the European Parliament and the EU’s Council of Ministers if it were to become reality.
“Europe needs these fast broadband networks to allow its economy to become more competitive in the future, and so create more jobs and prosperity,” EU sources said.
“This money would stimulate much greater investment of private and other public money. Each euro [invested by the Commission] would give rise to a further six to 15 euros more.”
At least €7bn of the investment would go to building high-speed broadband networks, with the funding mostly in the form of debt instruments and equity.
The hope is that giving infrastructure projects credibility in this way would encourage the private sector, as well as local and national governments, to invest at least a further €50bn in the rollout.
European Parliament debate on fast broadband from 9 May 2011
The remainder of the Commission’s funding would be parcelled out in grants for projects that could help create a single European market for broadband-based services such as e-health, cybersecurity and intelligent energy networks.
The money would come from a new fund called the Connecting Europe Facility (CEF). This proposed fund would also be used for new transport and energy projects, with the Commission and the European Investment Bank absorbing risk and boosting the projects’ credit ratings.
Part of the plan is for the CEF to pressure established telecommunications companies into investing more in their own networks, as they would not be the only ones able to bid for funding.
New players such as water, sewage and electricity utility companies would also be encouraged to enter the broadband game with CEF backing, as would construction firms, cooperatives and public authorities.
A particular objective is to get more money invested in rural broadband. Left to their own devices, telecoms companies often invest less in such areas because they are not as profitable as more densely-populated towns and cities.
While the Commission’s digital agenda is largely about getting citizens on fast connections, it also contains plans to make electronic public services available equally across the continent.
Under the proposals to be unveiled on Wednesday, grants could go to cross-border e-health and electronic procurement services, smart energy networks and coordinated efforts to take down online child pornography.
Other examples of projects that would meet the Commission’s criteria include pan-EU electronic identity schemes, systems that would encourage access to European culture, and multilingual public information services.
The Commission also hopes its plan would immediately create hundreds of thousands of jobs in the construction and telecoms equipment industries, as efforts to install fibre optic cable networks increase with the additional backing.
European funding has already found its way to several fast broadband projects in the UK. Last year the European Regional Development Fund provided £53.5m to aid BT’s next-generation broadband scheme in Cornwall, while £18.5m went to the development of Northern Ireland’s broadband infrastructure, also in collaboration with BT.
U.S. cell phones, tablets outnumber Americans
NEW YORK (CNNMoney) — The number of wireless devices in the United States now outnumbers the people living here.
Connected devices with wireless subscriptions rose to 327.6 million in the second quarter, according to a new report from wireless industry association CTIA. That represents a 9% increase since the same period last year. The U.S. population currently clocks in at 312.4 million, the U.S. Census Bureau said.The growing popularity of smartphones and tablets like the iPad means that many Americans now have two or more devices with a wireless plan. The number of active U.S. smartphones increased 57% to 95.8 million, and tablets grew 17% to 15.2 million.
“Americans love wireless and continue to rely on the most cutting-edge and innovative devices,” said Steve Largent, president of CTIA, in a statement. “Clearly, we’re using wireless more every day, and the consensus of experts is that demand will continue to skyrocket by more than 50 times within the next five years.”
In a sign that wireless habits are changing, voice minute usage increased just 1% to 1.2 trillion minutes, while texting increased 16% to 1.2 trillion messages.
Yet wireless data traffic grew 111% from a year ago to an astounding 341.2petabytes (that’s 341.2 billion megabytes) over the past year.
How many iPhones did Apple sell last quarter?
I expect Apple (AAPL) to report two important iPhone statistics next week.
The first, the number of iPhone 4S units sold this coming weekend, the company won’t know until after midnight Sunday. The other, the number of iPhones sold last quarter, it already has in hand.
In this post, I’m going to look at the second number, which my two teams of analysts — professional and amateur — have been tracking since the end of June.
The two groups rarely agree, but the discrepancy this quarter is unusually large.
The estimates of the 28 professional analysts who have submitted their numbers to Fortune.com range from a high of 23 million from FBN’s Shebly Seyrafi to a low of 16.92 million from Goldman Sachs’ Bill Shope. The average among this group is 19.82 million iPhones, a bit below the record 20.34 million the company sold in the June quarter.
The average among our 16 amateurs, by contrast, is 22.91 million, which would set a new record. Among this group, the estimates range from a low of 19.52 million from Apple Finance Board’s Alexis Cabot to a high of 26.8 million from Asymco’s Horace Dediu.
We’ll find out who was closest to the mark when Apple reports its earnings after the markets close next Tuesday, Oct. 18.
Below the fold: The analysts’ individual estimates, with the pros in blue and the amateurs in green. For their revenue and EPS estimates,
CNN Money ……………
Social media revenue to hit $10bn in 2011, says Gartner
Worldwide revenues from social media sites such as Facebook are on track to reach $10bn this year.
That is up 41% from 2010, according to technology research firm Gartner.
These figures are set to explode in the next few years, projected to grow by 50% next year and nearly triple to $29bn by 2015.
Advertising revenue is the largest contributor to this overall figure, with social gaming bringing in another significant revenue stream.
Room for growth
Analysts believe this is only the beginning in terms of making money from social media.
Neha Gupta, senior research analyst at Gartner, said: “From a revenue perspective, the social media market is still in its early stages, even though it has a large number of users who, in some cases, are exhibiting increasingly mature usage patterns.”
She said new business models would need to be built to tap into this revenue, where a transition would take place from clicking on an ad to “ongoing engagement” with online users.
Ms Gupta said that social networking sites, with the help of social analytics firms, were able to “unlock” data – “mapping lists of friends, their comments and messages, photos and all their social connections, contact information and associated media”.
However, other analysts point out that wider use of this data raises concerns about privacy, with some users angry about the ways in which their online behaviour may be tracked.
Microsoft Skype deal gets green light in Europe
Microsoft’s takeover of internet phone service Skype has been approved by European authorities.
The $8.5bn (£5.4bn) deal would not “significantly impede effective competition across the single European market”, the European Commission said.
There were “numerous players, including Google” in “this growing market”, it added.
Luxembourg-based Skype has more than 650 million global users and is Microsoft’s largest single acquisition.
The deal was first announced in May this year.
Internet auction house eBay bought Skype, which was founded in 2003, for $2.6bn in 2006, before selling 70% of it in 2009 for $2bn.
This majority stake was bought by a group of investors led by private equity firms Silver Lake and Andreessen Horowit.
Under the terms of the deal, Skype will now become a new division within Microsoft. Skype chief executive Tony Bates will continue to lead the business, reporting directly to Microsoft boss Steve Ballmer.
Calls to other Skype users are free, while the company charges for those made to both traditional landline phones and mobiles.
India launches “world’s cheapest” tablet computer
By Frank Jack Daniel
NEW DELHI | Wed Oct 5, 2011 9:40am EDT
(Reuters) – India launched what it dubbed the world’s cheapest tablet computer Wednesday, to be sold to students at the subsidized price of $35 and later in shops for about $60.
Most of India’s 1.2 billion people are poor and products such as Apple Inc’s iPad are beyond the reach even of many in the fast-growing middle class.
“The rich have access to the digital world, the poor and ordinary have been excluded. Aakash will end that digital divide,” Telecoms and Education Minister Kapil Sibal said.
The government is buying the first units of the lightweight touch-screen device, called Aakash, or “sky” in Hindi, for $50 each from a British company which is assembling the web-enabled devices in India.
A pilot run of 100,000 units will be given to students for free, with the first 500 handed out at the launch to a mixed response. It supports video conferencing, has two USB ports and a three-hour battery life but some users said it was slow.
India has a reputation for creating affordable products that are easy to use and sturdy enough to handle its rugged environment — from Tata Motors’ $2,000 Nano car to generic versions of pharmaceuticals.
Two years in development, the paperback book-sized Aakash may help the government’s goal of incorporating information technology in education, although critics were doubtful of its mass appeal.
Despite being a leader in software and IT services, India trails fellow BRIC nations Brazil, Russia and China in the drive to get the masses connected to the Internet and mobile phones, a report by risk analysis firm Maplecroft said this year.
The number of Internet users grew 15-fold between 2000 and 2010 in India, according to another recent report. Still, just 8 percent of Indians have access. That compares with nearly 40 percent inChina.
The Aakash is aimed at university students for digital learning via a government platform that distributes electronic books and courses.
Testing included running video for two hours in temperatures of 48 degrees Celsius (118 degrees Fahrenheit) to mimic a northern Indian summer, said DataWind, the small London-based company that developed the tablet with the Indian Institute of Technology.
Rajat Agrawal, executive editor of gadget reviewers BGR India, said the 660 mhz processor from U.S. company Conexant Systems was “decent” for the price, but warned the machine seemed slow and the touch screen not very agile.
“Because of the price there is a lot of excitement,” he said. “People might use it initially but if it is not user friendly they will give up within a week.”
After first giving them out for free, the government aims to sell them to students for $35 next year. A retail version will be sold in Indian shops for about $60.
The device uses resistive LCD displays rather than a full touch screen and connects via wireless broadband. DataWind CEO Suneet Singh said future versions would include a mobile phone connection, making it more useful in rural areas.
The launch last week of Amazon’s Kindle Fire shook up the global tablet market, with its $199 price tag and slick browser a serious threat to Apple’s iPad.
Like the Kindle Fire, the Aakash uses the Google Android operating system.
Some of the mainly middle-class technology department students at the event said it needed refinement but was a good option for the poor.
“It could be better,” said Nikant Vohra, an electrical engineering student. “If you see it from the price only, it’s okay, but we have laptops and have used iPads, so we know the difference.”
Some 19 million people subscribe to mobile phones every month, making India the world’s fastest growing market, but most are from the wealthier segment of the population in towns.
courtesy to Reuters
Eurozone delays decision on next Greek payout
Eurozone finance ministers have delayed making a decision on giving Greece its next instalment of bailout cash, sending European shares down sharply.
It came after Greece said it would not meet this year’s deficit cutting plan.
A meeting set for 13 October, when finance ministers had been expected to sign off the next Greek loan, has now been cancelled, said BBC Europe correspondent Chris Morris.
French shares fell 3.3%, German stocks by 3.2%, and the UK’s FTSE by 2.4%.
As a result of the decision by finance ministers, Greece may not get its next loan tranche until November.
Its Finance Minister, Evangelos Venizelos, said that should not cause any difficulties as the Greek government had no funding problem until November.
Greece had previously said it needed the money by mid-October to avoid defaulting on its loans, but Eurogroup chairman Jean-Claude Juncker said at a meeting of finance ministers in Luxembourg that the country would be able to meet its financial obligations as long as it received the next 8bn-euro (£6.9bn; $10.9bn) tranche of money in November.
Mr Juncker also ruled out the possibility of a debt default by Greece – denying rumours that some countries, including Germany, had been pushing for this.
Jane Foley, strategist at Rabobank, said: “The market is increasingly worried about the potential of the Greek crisis and the calamity that could be created if there was a messy default.” ”
Jane FoleyStrategist at Rabobank
But he warned that Greece’s private sector creditors could expect greater losses on their Greek sovereign debt holdings than the 21% “haircut” agreed in July.
The private sector agreed to participate in a second bailout of Greece, with the eurozone and IMF providing 109bn euros in new funds.
Mr Juncker said: “As far as PSI [private sector involvement] is concerned, we have to take into account that we have experienced changes since the decision we have taken on 21 July.”
The meeting also appeared to reach a deal to let Finland receive collateral as security for its contribution towards the eurozone bailout fund – the European Financial Stability Facility.
Mr Venizelos said Greece would offer Finland 880m euros of bonds as loan collateral.
Finland’s Prime Minister, Jyrki Katainen, said the collateral model it would use to take part in Greece’s bailout package would be useful in other possible aid packages in the future.
Mr Katainen told reporters: “This model is a good one… I think it could be used in future as well.”
The Finns had threatened to block further bailouts to Greece unless it received this special arrangement.
Banking stocks were again among the biggest fallers, due to concerns about their exposure to Greek government bonds.
In France, Societe Generale was 7% lower, while BNP Paribas had lost 6.3%, and Credit Agricole had fallen 5.9%.
German’s Commerzbank was down 5.7%, while in the UK Lloyds Banking Group had shed 4.2%.
Meanwhile, the Franco-Belgian bank Dexia, the bank the market judges most vulnerable to Greece, saw its shares tumble around a quarter to around 1 euro (86p).
The euro fell to a 10-year low against the yen and slipped against the dollar to $1.3144, a nine-month low.
Jane Foley, strategist at Rabobank, said: “The market is increasingly worried about the potential of the Greek crisis and the calamity that could be created if there was a messy default.
“Dexia’s problems stress the point that for eurozone leaders the Greek crisis is less about Greece and more about the potential for it to spark a much more widespread banking and economic disaster.”
On Monday, Athens announced that the 2011 deficit was projected to be 8.5% of GDP, down from 10.5% in 2010 but short of the 7.6% target set by the EU and IMF.
The government, which on Sunday adopted its 2012 draft austerity budget, blamed the shortfall on a worsening economy, which is expected to contract by 5.5% rather than the 3.8% forecast in May.
Data released on Tuesday showed the effects of the austerity programme on household spending.
Greek retail sales fell 4.3% in the year to July, although the figure was far worse in June when sales were 11.4% lower year on year.
Inspectors from the International Monetary Fund (IMF), European Union (EU) and European Central Bank are currently in Athens to examine Greece’s financial position.
The Greek finance ministry said on Sunday that its unpopular austerity measures would have to be adhered to.
It said: “Three critical months remain to finish 2011, and the final estimate of 8.5% of GDP deficit can be achieved if the state mechanism and citizens respond accordingly.”
It released figures for 2012’s projected deficit, putting it at 6.8% of GDP, also short of the 6.5% target.
The data came as the government met to approve Greece’s draft budget for next year.
Continue reading the main story
- 3 Oct: Original deadline for Greece to receive next 8bn-euro tranche of bailout funds;
- Next few days: Troika decides whether to recommend that Greece gets the next tranche;
- 9 Oct: Leaders of Germany and France to hold talks;
- 14-15 Oct: G20 finance ministers meet in Paris;
- 17 Oct: Slovakia votes on whether to expand the European Financial Stability Facility. Members of the coalition government have vowed to block expansion;
- 17-18 Oct: European Union summit in Brussels;
- End of Oct: Greece to get next bailout money – assuming no more hurdles;
- 3-4 Nov: G20 summit in Cannes, France. World leaders, including Barack Obama, want evidence that Europe have got control of debt crisis
The cabinet meeting also approved a measure to put 30,000 civil service staff on “labour reserve” by the end of the year.
This places them on partial pay with possible dismissal after a year.
This measure, along with other wage cuts and tax rises, have been part of a package intended to persuade the so called “troika” of the EU, IMF and ECB to continue with the bailouts.
The Greek austerity measures are hugely unpopular at home and have led to a wave of strikes and protests.
Protesters again blocked the entrance to several ministries on Tuesday, including the Finance and Transport ministries.
Many Greeks believe the austerity measures are strangling any chance of growth.
Courtesy to BBC
Amazon unveils $199 Kindle Fire tablet
By PETER SVENSSON – AP Technology Writer | AP – 7 hrs ago
NEW YORK (AP) — Amazon CEO Jeff Bezos on Wednesday showed off the Kindle Fire, a $199 tablet computer, challenging Apple’s iPad by extending its Kindle brand into the world of full-color, multipurpose devices.
Bezos also took the opportunity at a New York press event to introduce a new line of Kindle e-readers with black-and-white screens and lower prices, further pressuring competitors likeBarnes & Noble Inc. that are trying to break Amazon.com Inc.’s dominance in electronic book sales.
The Kindle Fire will go on sale Nov. 15. It’s about half the size of the iPad, making it a close match with Barnes & Noble’s Nook Color tablet, which came out last year. But while Barnes & Noble sees the Nook Color as jazzed-up e-reader, Amazon has broader goals for the Fire, as a platform for games, movies, music and other applications.
Even before its release, the Kindle Fire was heralded as a worthy competitor to Apple’s iPad. Amazon is nearly unique in its ability to sell content such as e-books, movies and music suited for a tablet — just like Apple Inc. does.
Still, competing with Apple won’t be easy. Many have tried to copy the iPad’s success, but it remains the overwhelming front-runner in the tablet computer category. Apple sold 28.7 million of them from April 2010 to June 2011. Analysts at research firm Gartner Inc. expect the iPad to account for three out of four tablet sales this year.
“Some of the companies that have made tablets and put them on the market … the reason they haven’t been successful is because they made tablets. They didn’t make services,” Bezos said in an interview. “So what we’ve done is really integrate seamlessly all of our media offerings — video, movies, TV, apps, games, magazines, games and so on.”
Forrester Research analyst Sarah Rotman Epps said selling all that content makes the Fire is the only credible competitor to the iPad this year.
“In theory, Sony could do something similar, but they haven’t, and it doesn’t look like they will. They have a tablet, but they only went halfway on the services,” she said.
Analysts had expected the Fire to go on sale for about $250. Epps called the $199 price “jaw-droppingly low,” and said it would introduce tough competition not just for Apple, but for contending tablet makers like Samsung Electronics Co., Motorola Mobility Holdings Inc. and HTC Corp.
Analysts had speculated Amazon would subsidize the tablet, counting on making back some money through book and movie sales. But Bezos said the company is content with a slim profit margin.
“We want the hardware device to be profitable and the content to be profitable. We really don’t want to subsidize one with the other,” Bezos said in the interview with The Associated Press.
Epps believes Amazon will sell 3 million to 5 million Fires before the end of the year, but the late shipping date will probably skew the figure to the lower end of the range, she said.
The Fire runs a version of Google Inc.’s Android software, used by other iPad wannabes, and will have access to applications through Amazon’s Android store. It lacks the cameras sported by practically every competing tablet. It also lacks a slot for memory expansion, a common feature on other Android tablets.
Amazon’s cheapest new Kindle will cost $79, and dispenses with the keyboard the Kindles have carried since the first model launched in 2007.
For $99, Amazon is also bringing out the first black-and-white Kindle with a touch screen; it’s reminiscent of Barnes & Noble’s latest Nook. A version with access to AT&T’s cellular network will cost $149. Versions without advertising cost an extra $30 to $40. Bezos said the models subsidized by advertising have been the most popular.
Previously, the cheapest Kindle cost $114, with advertising. That price was reduced Wednesday to $99.
IPad has ‘80% of North American tablet market’
Apple’s iPad captured 80% of the tablet computer market in the US and Canada in April to July, a report has said.
The iPad accounted for six million of all 7.5 million tablets shipped in North America during the second quarter of 2011, according to research group Strategy Analytics.
It described Apple as a “formidable market leader”.
Yet it added that Amazon – which is expected to unveil its own tablet this week – could become a big challenger.
Stategy Analytics senior analyst Alex Spektor said: “Apple remains a long way ahead of its main rivals such as Motorola, Samsung, RIM, Asus and HTC.
“A combination of cool branding, user-friendly hardware, entertaining services and savvy retail distribution has made Apple a formidable market leader.”
According to reports, online retailer Amazon could announce the release of its first tablet as early as Wednesday.
“Provided the pricing, screen size and hardware design are right, Amazon can be one of the main challengers to Apple’s dominance,” said Neil Mawston, director at Strategy Analytics.
“Like Apple, Amazon has a strong brand, compelling content, sophisticated billing systems and widespread distribution.
“In effect, Amazon’s new tablet product represents a good opportunity to place an Amazon shopping cart in the hands of American consumers, offering optimised access to purchasing digital content or physical goods from the Amazon online store.”
The continuing popularity of Apple’s iPad comes despite its incompatibility with Adobe Flash software, meaning that users cannot view a large number of online videos.
Rivals such as Samsung are quick to highlight in their advertising that their tablets are able to use Flash.
Apple and Samsung, which makes the Galaxy range of tablets, are also continuing a number of legal disputes over patents.
On Monday, Apple declined to comment on reports that it had cut orders for iPad parts from its suppliers because of falling sales.
The study by an Asian analyst of US bank JPMorgan Chase said several suppliers had indicated that Apple had reduced its orders by 25%.
The iPad was first released in April 2010, with the second version, the iPad 2, following in March of this year.
Courtesy to BBC
Japan may consider being part of Greece bailout plan
Finance minister, Jun Azumi, said eurozone countries needed to come up with a rational plan to ease global concerns.
Mr Azumi’s comments come a day after the Nikkei 225 index fell to a two-and-a-half year low amid fears that the debt crisis may slow global growth.
However, on Tuesday, the Nikkei rose, giving further proof of volatility.
“If there is a scheme that is based on a firm process, involves a reasonable amount of money and could provide the world and markets with a sense of security regarding a Greek bailout, I would not rule out the possibility of Japan sharing some of the burden,” Mr Azumi was quoted as saying by the Reuters news agency.
The finance ministry confirmed those comments to the BBC.
Continue reading the main story
Japanese banks and insurance companies are big investors in stock markets and if the Nikkei had to plunge it will send the domestic financial system in turmoil.”
Masaaki KannoJP Morgan
Analysts said Japan’s willingness to consider sharing some of Greece’s bailout burden stemmed from the fact that it wanted to ensure stability in the region.
Europe is a key market for Japanese exports and there are concerns that if a solution to the ongoing debt crisis is not found soon it may hurt growth and dent demand for Japanese goods.
“If the financial turmoil spread from Europe to the rest of the world, Japan will not be immune,” Masaaki Kanno of JP Morgan told the BBC.
Growing uncertainty in Europe may also see investors flock to traditional safe havens such as the yen.
That may result in the Japanese currency strengthening even further against the US dollar and the euro.
A strong currency not only makes Japanese goods more expensive, but also hurts the profits of companies when they repatriate their foreign earnings back home.
At the same time, the ongoing crisis has resulted in sharp falls at the Tokyo Stock Exchange.
Mr Kanno added that if the falls continue, it could be detrimental for the Japan’s economy.
“Japanese banks and insurance companies are big investors in stock markets and if the Nikkei continues to plunge, it will send the domestic financial system in turmoil.”
Eurozone governments are in talks to discuss how best to stop the crisis spreading from Greece to the rest of the continent.
Courtesy to BBC
After 3 years, Boeing Dreamliner becomes reality
By Tim Hepher | Reuters – 6 hrs ago
SEATTLE (Reuters) – Boeing’s long-awaited dream machine became a commercial reality on Sunday when the lightweight plastic-composites 787 Dreamliner was formally delivered to its first Japanese customer.
Boeing says the revolutionary carbon fiber design will hand 20 percent fuel savings to airlines struggling to avoid a new recession, and give passengers a more comfortable ride with better cabin air and large electronically dimmable windows.
The first $200 million aircraft was handed over to Japanese carrier All Nippon Airways three years behind schedule after persistent delays that cost Boeing billions of dollars.
“It took a lot of hard work to get to this day,” said Scott Fancher, vice president and general manager of the 787 program, at the outset of two days of celebrations at the plane’s Seattle production plant.
The blue and white-painted long-range aircraft, which boasts a graceful new design with raked wingtips, will leave for Japan on Tuesday and enter service domestically on October 26.
Boeing has taken orders for 821 Dreamliners, which will compete with the future Airbus A350, due in 2013.
The much-anticipated handover came a week after another major first delivery — the 747-8 Freighter — was abruptly postponed in a contract dispute with the customer. ANA, the world’s ninth largest airline by revenues, plans to coax the airplane into service on domestic routes before putting it on longer international routes like Frankfurt, Germany.
The aircraft goes 52 percent further than the all-metal Boeing 767 which it is designed to replace while using 20 percent less fuel for the distance flown, an ANA executive said.
In a classic roll of the dice in the high-stakes aerospace industry, Boeing abandoned plans for a sound barrier-chasing “Sonic Cruiser” a decade ago and worked on lighter long-range jets as cash-starved airlines valued efficiency over speed.
The resulting composites-based technology proved popular with airlines, forcing Airbus to turn its back on the aluminum airframe for its next generation of jets. Boeing expects this to become the standard for future passenger planes.
“Technology will only get more efficient and lighter,” said the 787 program’s chief project engineer Mike Sinnett.
BUYER CONFIDENT ON RAMP-UP
The plane’s lighter weight allows airlines to operate routes even when the demand is insufficient for larger aircraft like the Boeing 777 or 747, or the Airbus 380 superjumbo.
“For aviation we believe this is as important as the 707 was with the introduction of the jet age,” Fancher said.
He moved to head off any fears over the new materials, stressing tough composites were nothing like ordinary plastic.
“Plastic is what you have on the dashboard of your car. This is not plastic,” he told reporters.
The 787 development program has been delayed seven times due to challenges with engineering, supply chain glitches and a 58-day labor strike in 2008. [ID:nS1E78O09V]
“We have been waiting for the 787 for over 3 years as we expected it in the summer of 2008,” said senior vice president Satoru Fujiki who took part in negotiations to buy the 787.
“I can’t say the delayed delivery didn’t have any impact but ANA and Boeing worked closely to mitigate it,” he said, adding Boeing had provided alternative jets to meet the shortfall.
ANA has ordered a total of 55 Dreamliners worth $11 billion at current list prices, including 40 of the 260-passenger 787-8 variant being delivered this week. #
ANA plans to take delivery of 4 planes in 2011 and an additional 8 next year. “By the end of 2017 we will get all our 787’s so it is catching up on all our deliveries.”
The Seattle Times reported on Sunday that 787 program costs had topped $32 billion due to delays. That estimate raised questions, the newspaper said, over whether the new jet would make money for Boeing before “well into the 2020s, if ever.”
Boeing declined comment.
Analysts say new jets typically cost closer to $15 billion.
Boeing also faces Wall Street concerns over its ability to reach its target of lifting output to 10 planes a month by 2013.
“Boeing still has to achieve a smooth production ramp-up and still has to do rework on some 40 airplanes that it says will take years to complete,” aerospace analyst Scott Hamilton said.
Asked how confident he was that Boeing would stick to its latest output goals, ANA’s Fujiki said: “We are quite confident in Boeing’s ability to deliver on schedule this time.”
Also uncertain is how many planes Boeing must sell to break even, something the company is not yet saying.
“If it is 1,200, they should make money; if it is larger than that it could be challenging,” Hamilton said.
The delivery comes as Boeing remains locked in a dispute with one of its top labor unions in Washington state, where it has traditionally built its aircraft.
The International Association of Machinists and the National Labor Relations Board accuse Boeing of building a non-union 787 plant in South Carolina to punish the IAM for past strikes.
Boeing denies that claim, saying the jobs in South Carolina represent new employment, not the relocation of existing work. The issue has become a political lightning rod, with Republicans denouncing the Democratically controlled NLRB as being unfriendly to U.S. companies.
(Additional reporting by Kyle Peterson, Editing by Dale Hudson and Diane Craft)
Only 55 percent of young Americans have jobs,
lowest since WWII
By Zachary Roth | The Lookout
“We have a monster jobs problem, and young people are the biggest losers,” Andrew Sum, an economist with the Center for Labor Market Studies at Northeastern University told the Associated Press.
Just 55.3 percent of people between 16 and 29 were employed in 2010 on average, the according to new figures released by the Census Bureau. That represents an enormous drop from 67.3 percent in 2000. Among teens the figure was less than 30 percent.
The result? Young people are delaying taking the steps that traditionally represent movement into adult life: moving to a new place, getting married, and buying a new home. Just 4.4 percent of 18- to 34-year olds moved across state lines — again, the lowest level since World War Two (though such moves have been declining since long before the recent downturn, it’s worth noting). Roughly 5.9 million Americans between 25 and 34 lived with their parents. That’s up by 25 percent since before the recession began in late 2007. (Men are nearly twice as likely as women to move back in with Mom and Dad.) The marriage rate for those between 25 and 34 fell to 44.2 percent, also a new low. And home ownership declined for the fourth straight year.
“Many young adults are essentially postponing adulthood and all of the family responsibilities and extra costs that go along with it,” Mark Mather of the Population Reference Bureau told the AP. If that continues, it would make the U.S. more like Europe, where youth unemployment is far higher and many people continue to live with their parents into their 30s.
In addition, studies have shown that when people experience unemployment at a young age, it depresses their likely earning power over the course of their entire career. “These people will be scarred, and they will be called the ‘lost generation’ – in that their careers would not be the same way if we had avoided this economic disaster,” Richard Freeman, an economist at Harvard, said.
Courtesy to Daily Yahoo News
Has October 4 been pegged for Apple to launch iPhone 5?
- Media event expected to showcase upgrade, with handset available within a month
- Samsung considering legal action to ban new iPhone
- Company ‘will sue’ to stop iPhone selling in Korea
- Apple lawsuits attack Samsung touchscreens
By ROB WAUGH
Apple is set to unveil the next upgrade of its popular iPhone, a prestigious technology website has reported, citing sources close to the tech giant.
AllThingsDigital said Apple is expected to hold its next big media event on October 4, when it is expected to launch the iPhone 5.
Apple plans to make the new device available for purchase within a few weeks of the launch, sources added.
While the iPhone 5 is much anticipated, the event itself has a lot more importance for Apple than usual.
This is because, since legendary outgoing CEO and co-founder Steve Jobs announced his forthcoming departure, it will be newly installed CEO Tim Cook’s first big product introduction, and the place where the public will get a first lengthy impression of him.
Ever since Apple launched its iPhone, it’s been an open secret that Samsung makes many of the components inside it – in fact Samsung’s CEO has admitted, ‘Apple is our biggest customer.’
But ever since Samsung launched its own Galaxy series of phones and tablets – high-powered touchscreens whose flagship, the Galaxy S II, currently outpaces iPhone on the processing front – legal war has erupted between the companies in nine countries.
This week, a Samsung source revealed Samsung was considering legal action to ban Apple’s upcoming iPhone 5 in Europe – after an executive admitted a similar move in Samsung’s native Korea was planned.
A Samsung executive told the Korea Times this week, ‘When the iPhone 5 arrives here, Samsung plans to take Apple to court here for its violation of Samsung’s wireless technology related patents.’
This is in response to Apple’s continued legal action against Samsung’s Galaxy family of touchscreen tablets and smartphones – some of which are currently illegal in Europe, thanks to Apple lawsuits claiming they are ‘slavish’ copies of iPhone and iPad.
Samsung recently overtook Nokia in the smartphone market, and its Galaxy S II offers a larger screen and faster processor than iPhone 4 – and has been a huge hit among geeky smartphone connoisseurs.
This month, Apple even forced Samsung to withdraw a prototype tablet device from the show floor of a Berlin electronics show. Samsung’s larger Galaxy 10.1 tablet remains illegal in Europe thanks to Apple’s legal action.
The Maeil Business Newspaper reported that the South Korean firm may seek an injunction against Apple’s new iPhone in Europe. Samsung said it would not comment on ongoing legal issues.
The two technology firms have been locked in intensifying legal battles in nine countries over their flagship smartphone and tablet products – battles made more complex by the fact that many related patents are held by other internet giants such as Google and Microsoft.
The latest attacks come after Apple successfully blocked Samsung from selling its latest tablets in Germany and some smartphone models in the Netherlands and forced its rival to delay launching new tablets in Australia.
After Apple’s latest legal victory in Germany earlier this month, Samsung said it would take all available legal options.
Apple first sued Samsung in April, claiming its strongest competitor had ‘slavishly’ copied its product designs, and Samsung had since counter-sued, arguing Apple infringed on its mobile technologies.
Courtesy to Daily Mail UK
Airbus: Passenger planes to double over 20 years
The number of planes made by all manufacturers of more than 100 seats will grow from 15,000 this year to 31,000 by 2030, it forecast.
China, the US and Germany are predicted to generate the greatest demand.
“Over the next 20 years, Asia-Pacific will account for 34% of demand, Europe 22% and North America 22%,” it said.
Airbus, speaking at its annual global forecast meeting, predicted that the number of low-cost airlines will make up around 19% of all air traffic by 2030, compared with around 5% currently.
It claims the number of middle-class people – traditionally more likely to fly – will grow from 1.84 billion this year to almost 5 billion by 2030.
Airbus’s forecast also includes 900 newly built freighter aircraft for commercial use. Two thirds of the world’s cargo planes have been converted from conventional passenger planes.
The European firm, which makes the giant double-decker A380 superjumbo, believes long-haul air traffic will grow three-fold over the next 20 years.
It could even launch an extra-large version of the A380 by the end of this decade, it said.
Courtesy to BBC
Samsung considers legal action over Apple’s new iPhone: source
By Miyoung Kim | Reuters – 50 mins ago
(Reuters) – Samsung Electronics Co is considering legal action to ban sales of Apple’s new iPhone, a source familiar with the matter said on Tuesday, in what could be its strongest step to defend against claims by the U.S. firm that the South Korean firm had copied its product designs.
The source declined to elaborate further on where Samsung planned to take legal actions and the Maeil Business Newspaper reported that the South Korean firm may seek injunction request on Apple’s new iPhone in Europe.
Samsung said it would not comment on ongoing legal issues.
The two technology firms have been locked in intensifying legal battles in nine countries over their flagship smartphone and tablet products.
The move comes after Apple successfully blocked Samsung from selling its latest tablets in Germany and some smartphone models in the Netherlands and forced its rival to indefinite delay launching new tablets in Australia.
After Apple’s latest legal victory in Germany earlier this month, Samsung said it would take all available legal options.
Apple has not produced a new version of its best-selling iPhone for more than a year. The product is crucial for the world’s No.1 smartphone maker to keep its strong sales momentum as Samsung is quickly closing on the gap with its Galaxy line of products.
Apple sold 20.3 million iPhones in the second quarter and Samsung shipped just one million units less than that.
Media reports have said Apple’s product will go one sale in October.
Apple first sued Samsung in April, claiming its strongest competitor had “slavishly” copied its product designs, and Samsung had since counter-sued, arguing Apple infringed on its mobile technologies.
Samsung is also a major supplier of chips and displays for Apple’s smartphones and tablet products.
UBS ‘rogue trader’: Loss estimate raised to $2.3bn
Continue reading the main story
- Q&A: ‘Rogue trader’ allegations
- Profile: Swiss bank UBS
- Leeson apology for Barings crash
UBS has raised its estimated losses due to alleged unauthorised trading to $2.3bn (£1.5bn) from an initial $2bn.
The bank also said the alleged activity by trader Kweku Adoboli was uncovered after UBS began making inquiries.
That prompted Mr Adoboli to admit the losses on Wednesday, UBS said. The trader was charged with fraud and false accounting at a London court on Friday.
The bank’s statement comes as UBS boss Oswald Gruebel insisted he would not resign over the incident.
“I’m responsible for everything that happens at the bank,” Mr Gruebel told Swiss Sunday newspaper, der Sonntag. “if you ask me whether I feel guilty, then I would say no.”
Mr Adoboli has been remanded in custody until a committal hearing on 22 September.
According to the charges, the fraud took place between January and September this year.
Continue reading the main story
S&P 500 Cash Index – Chicago Mercantile Exchange
LAST UPDATED AT 16 SEP 2011, 19:59 GMT
Top winner and loser
Rockwell Collins Inc.
The charges add that Mr Adoboli filed false accounts between October 2008 and December 2009, and from January to September 2011.
However, UBS latest statement said the losses only related to trading positions taken on in the last three months.
The 31-year-old worked for UBS’s global synthetic equities division, buying and selling exchange traded funds, which track different types of stocks or commodities such as precious metals.
Prosecutors say Mr Adoboli “dishonestly abused that position intending thereby to make a gain for yourself, causing losses to UBS or to expose UBS to risk of loss”.
The UBS statement claimed Mr Adoboli had conducted legitimate derivative transactions, giving the bank heavy exposure to various stock market indexes.
But he had then entered “fictitious” hedges against these positions into UBS’ risk management system, while in reality he had no hedge in place and was breaching the risk limits that the bank required him to work within.
Stock markets have fallen 10%-20% in the past two months on growing fears of a renewed recession in the US and a disorderly debt default by Greece.
“Following inquiries directed to him by UBS control functions that were reviewing his positions, the trader revealed his unauthorized activity on September 14, 2011,” the UBS statement said.
The bank said it was now operating within normal risk limits, implying that the unauthorised positions had been hedged or unwound.
BBC business editor Robert Peston reports that Mr Adoboli worked in the back office before becoming a trader, which may explain how he managed to keep his trading secret.
Continue reading the main story
UBS could have opted for a nuclear option and split its investment bank entirely from the rest of its operations. That was suggested by the Swiss authorities as a way to soothe rattled investors and minimise risk.
It looks as if that has been resisted – for now. As have the calls for the chief executive Oswald Grübel to step down.
UBS has spent the past few days reassuring their very wealthy private clients that their money is safe and the horrendous oversight by the bank in not keeping track of a $2.3bn fraud will not be repeated.
Keeping them sweet is vital for UBS which is the single biggest wealth manager in the world. One suspects that the independent probe by Morgan Stanley boss David Sidwell may have the final word on any further repercussions at one of Switzerland’s largest banks.
The Financial Services Authority (FSA), the City regulator, in conjunction with its Swiss counterpart, FINMA, has launched an investigation into why the Swiss bank did not identify the trades.
UBS said in its latest statement that it too had launched an internal inquiry.
City of London Police said in a statement that its “investigation is ongoing and officers continue to work in close collaboration with the FSA (Financial Services Authority), SFO (Serious Fraud Office) and CPS (Crown Prosecution Service).”
Mr Adoboli has taken on the law firm Kingsley Napley, which also represented Nick Leeson, the rogue trader who brought down Baring’s bank.
According to reports he is the son of a retired United Nations employee from Ghana, and that he attended school and university in Britain.
All three major ratings agencies – Moody’s, Standard & Poor’s and Fitch – are reviewing UBS’ credit rating for a possible downgrade in light of the apparent failure of the bank’s risk control systems.
Moody’s says it is reviewing UBS’s rating, focusing on “ongoing weaknesses” in the Swiss bank’s risk management.
It comes after UBS lost £35bn in the 2007-8 banking crisis and had to be bailed out by Swiss taxpayers.
Moody’s said that although UBS was strong enough financially to absorb the loss, it had concerns about its risk controls.
“We have continued to express concerns with regards to the ability of management to develop a robust risk culture and effective control framework,” the agency said.
Continue reading the main story
One banker described UBS’s inability to see what Mr Adoboli was doing as quite extraordinary.”
- Read Robert Peston’s blog
Last month the bank announced 3,500 job cuts. Of the 65,000 staff worldwide about 6,000 are in the UK, with the bulk of UBS’s investment banking operations based in London and New York.
It has been reported that the fresh losses from the investment bank will lead to a major restructuring of the business, involving thousands more job losses, which will be announced in November.
“We believe that yesterday’s event could have personnel consequences on senior management level, which in turn could lead to adjustments to UBS’ business portfolio,” said Teresa Nielsen, an analyst at the Swiss bank Vontobel.
“The exit from non-core businesses inside the investment bank could be accelerated,” she added.
World Bank chief says world economy in danger zone
By Lesley Wroughton | Reuters –
WASHINGTON (Reuters) – World Bank President Robert Zoellick said on Wednesday the world had entered a new economic danger zone and Europe, Japan and the United States all needed to make hard decisions to avoid dragging down the global economy.
“Unless Europe, Japan, and the United states can also face up to responsibilities they will drag down not only themselves, but the global economy,” Zoellick said in speech at George Washington University.
“They have procrastinated for too long on taking the difficult decisions, narrowing what choices are now left to a painful few,” he said ahead of meetings of the World Bank and International Monetary Fund next week.
His bluntly-worded speech highlighted mounting fears among global policymakers about an escalating sovereign debt crisis in Europe, which has for now overshadowed investor concerns about public finances and reforms in the United States and Japan.
Just as those very countries had called on China to be a responsible global stakeholder as a rising economic power, so too must they act responsibly and face up to their economic problems, Zoellick added.
Chinese Premier Wen Jiabao weighed in earlier and called on developed countries to take responsibility for fiscal and monetary policies to avoid the European crisis from spreading.
Meetings of global finance and development leaders in Washington next week will focus on Europe’s debt woes and the risk of a Greek debt default, which has fed growing alarm in financial markets.
Mixed signals from European leaders have escalated concerns the 17-member euro zone may be unable to unite behind a common approach to tackle the crisis.
Zoellick said European countries were resisting difficult truths about their common responsibilities, Japan had held off on needed economic and social reforms, and political differences in the United States were overshadowing efforts to cut record budget deficits.
“The time for muddling through is over,” Zoellick said. “If we do not get ahead of events; if we do not adapt to change; if we do not rise above short-term political tactics or recognize that with power comes responsibility, then we will drift in dangerous currents.”
Later, Zoellick said the European crisis had reached a point where its political leaders needed to decide on the future of the euro bloc instead of “dealing with problems day by day with patchovers.” He said he was confident the eurozone would survive.
But added: “To keep the eurozone with all of its current members, you’re going to need a much stronger fiscal union than you have today and someone is going to have to pay for that.
“If you’re not willing to have that fiscal union, then I don’t think you can keep the current construct,” Zoellick told CNBC in an interview.
Turning to the United States, he suggested slowing the rate of entitlement spending on social security and Medicare, and agree on broad-based tax reforms to boost growth.
“These in-between solutions, quick stimulus packages, I don’t believe will get us where the U.S. needs to go,” he added.
Zoellick’s speech focused on the shifting global landscape in which emerging market economies are playing a greater role in the world economy — and increasingly in development.
He said developed countries had yet to fully recognize these global shifts were underway and still operated under a “do what I say, not what I do” policy. They preached fiscal discipline but failed to rein in their own budgets, and advocated debt sustainability yet their own debts were at record highs, he said.
Zoellick also said it was time to rethink foreign aid, saying that while aid remains a life or death issue for millions of people around the world, it had also become a vehicle for helping poorer countries develop and grow, he said.
“In a world ‘Beyond Aid,’ assistance would be integrated with — and connected to — global growth strategies, fundamentally driven by private investment and entrepreneurship,” he said. “The goal would not be charity, but a mutual interest in building more poles of growth.”
He said development also meant tapping the power of women by eliminating gender inequality.
“We will not release the full potential of half of the world’s population until globally we address the issue of equality; until countries, communities, and households around the world acknowledge women’s rights and change the rules of inequality,” Zoellick said.
(Reporting by Lesley Wroughton, Editing by Gary Crosse)
Courtesy to CNN
Bank of America plans to cut about 30,000 jobs
Bank of America is to cut 30,000 jobs over the next few years as part of a cost-cutting programme.Bank of America Corp.
LAST UPDATED AT 12 SEP 2011, 19:57 GMT*CHART SHOWS LOCAL TIME
The cuts represent about 10% of the company’s workforce.
Bank of America wants to save about $5bn (£3.2bn) a year as it slims down the bank that was hit hard by the sub-prime mortgage crisis.
The cuts came on the day that President Barack Obama sent his $447bn jobs bill to Congress – his attempt to reduce the level of unemployment.
Bank of America is calling the cost-cutting programme Project New BAC, named after the code for its shares on the stock market.
It has also been selling off assets; last month it sold half of its 10% stake in China Construction Bank.
The shares initially rose, then fell back again amid disappointment at the lack of detail given about the cost-cutting plans. Late in the session they recovered to close up by 1.3%.
Last week, it was reported that Bank of America would be cutting 40,000 jobs and present a detailed turnaround plan.
The shares have lost about half their value this year as fears grow that it may have to issue more shares to meet new global capital requirements.
There was a brief recovery last month when it was announced that billionaire investor Warren Buffett had invested $5bn in the bank, but the shares have now fallen below the levels before that investment was made.
Greek prime minister pledges a battle to avoid “disastrous bankrupcy”
- NEW: Prime Minister George Papandreou says privatization is “necessary”
- Clashes were reported in Thessaloniki
- Greece is on the brink of default
(CNN) — Greek prime minister George Papandreou said Saturday his country will do what it takes to ensure that the country remains in the eurozone.
“We have made the decision to give a battle to avoid a disaster — a disastrous bankruptcy for the country and the citizen,” the prime minister said.
Speaking in the northern city of Thessaloniki, Papandreou said his government’s top priority is to ensure a secure course and to meet all requirements towards its lenders. He said any delay “is dangerous for the country.”
Papandreou said that all announced reforms will go ahead as planned. He specifically referred to the thorny issue of privatization that he referred to as “necessary for the country’s development” and the opening up to competition to a number of professions.
He restrained from giving details concerning anticipated changes, which include potential cuts, in Greece’s massive public sector.
Earlier Saturday, the first clashes were reported as thousands of Greek protesters and police fanned out ahead of an expected announcement by the country’s prime minister that additional austerity measures are on the way.
But Saturday’s announcement by the prime minister didn’t provide such details.
Some 5,000 police officers were deployed and about a growing number of protesters — at least 15,000 — gathered at the various meeting points, police told CNN.
According to police, a large number of the protesters were taxi drivers who are opposing reforms to open up their sector to competition.
Police on Saturday reported the first, minor clashes between police and protesters in the northern city of Thessaloniki, but later in the day, tensions cooled.
“Protesters have been hurling stones and other objects at police officers around the venue” where the prime minister was to speak, police spokesman Athanassios Kokkalakis told CNN. “Police responded with controlled use of tear gas, but overall things remain calm.”
According to local reports, Papandreou is expected to announce more austerity measures ahead of a new round of talks with Greece’s lenders next. It would be the latest in a round of increasing austerity measures that have been met by protests.
In the Sunday edition of Kathimerini newspaper, Finance Minister Evangelos Venizelos said that “if we need to take measures of an immediate fiscal result in order to meet our targets … these will be within a just tax system.”
Papandreou has been expected to announce measures such as 10,000 immediate job cuts in the public sector. He has also been expected to say that tens of thousands more civil workers are to lose their jobs within the next year.
If these measures are announced, they would be the first mass cuts in the public sector since Greece undertook a bailout plan this spring.
At the end of June, the Greek parliament voted to implement a round of austerity measures in hopes of avoiding defaulting on the government’s debt.
That decision came amid a round of large-scale protests in the streets, with riot police firing tear gas.
Demonstrators rejected measures including reductions in the pay of public workers and social security funding and an increase in the attrition of public jobs. Last year, an austerity package included pension cuts, higher taxes, and a hike in retirement age to 65 from as low as 61.
A default by Greece would send shock waves through the European banking sector and potentially dent global economic confidence.
Markets dropped sharply Friday as rumors of a possible Greek default circled the globe. The default could come as early as this weekend. Whether or not something happens in Greece will largely rule market sentiment as the market opens in New York on Monday.
Investors sold stocks Friday in fear that Athens may not get its next installment of bailout money from the European Union, International Monetary Fund and European Central Bank and that the bankruptcy could come to light over the weekend.
Courtesy to CNN
World’s top 10 safest airlines named
A report naming the top 10 safest airlines in the world is dominated by European and US carriers.
While European and American airlines rarely feature in the top 10 rankings for best customer service, airlines from these regions have dominated a new list of the world’s safest carriers.
A report by the Air Transport Rating Agency (ATRA), released yesterday, found that the safest carriers in the world were mainly those based in Europe and the US.
No Australian airlines featured in the top 10.
The safest US-based airlines are AMR Corporation, Continental Airlines, Delta Airlines, Southwest Airlines, United Airlines and US Airways, while the safest from Asia is Japan Airlines, it said, without giving a ranking within the top ten.
To obtain this classification, the first of its kind, ATRA examined publicly available information on 15 criteria, such as the average age of the aircraft used or the homogeneity of the fleet, it said.
The agency explained that to understand airline safety, one needed not only to look at accident figures, but also “technical, human, organisational and external” elements.
“Even though the European Union publishes a ‘blacklist’ of dangerous airlines, there exists a real difference in safety between the other airline companies,” ATRA added.
The agency believed the EU’s list was a good start on rating airline safety, but said the list led to the belief that all airlines not on the ‘blacklist’ offered the same level of safety, which was not the case.
According to its website, the Geneva-based agency says it is independent of all “airlines, manufacturers, regulatory authorities, trade unions and not-for-profit organisations” in performing its aviation risk assessment.
The top 10 list is in contrast to the annual Skytrax survey that ranks airlines based on customer service. None of the airlines in the Skytrax top 10 made the ATRA’s top 10 safety list.
World’s 10 safest airlines (in alphabetical order)
AMR Corporation (American Airlines, American Eagles)
Courtesy to AFP
8 September 2011
HSBC to cut 3,000 jobs in Hong Kong over three years
HSBC has said it will cut 3,000 jobs at its Asian headquarters in Hong Kong over the next three years, as part of a global cost-cutting plan.
The cuts will be in “support functions” according to a memo to employees seen by Reuters and Dow Jones news agencies.
Chief executive Stuart Gulliver announced last month that he was planning 30,000 job losses by 2013.
Many major banks have announced cost-cutting measures due to a slowdown in the sector and tougher regulation.
HSBC said the cuts were aimed at streamlining operations.
“For all of HSBC’s strengths as an organisation… we can be needlessly complex and bureaucratic,” Asia Pacific chief executive Peter Wong said in the memo.
“This complexity reduces our effectiveness and efficiency. Our best estimate at this time is that approximately 3,000 existing roles will be reduced over these three years.”
Mr Wong said some workers would be redeployed but that “jobs will be eliminated”.
HSBC was founded in Hong Kong and is one of the biggest employers in the city.
Despite today’s announcement, major banks such as HSBC have been shifting their focus towards the fast-growing Asian countries.
Almost two years ago, HSBC moved its global chief executive to Hong Kong, saying Asia was its most important region.
As a result, most of the job losses announced by Mr Gulliver last month are expected to be in Europe and North America.
In fact, the bank said it planned to hire at least 2,000 people in mainland China and Singapore over the next five years and that 3,000 to 5,000 jobs would be added each year in Asia.
Courtesy to Reuters
07/09/2011 web story
Obama to propose $300 billion jobs package: report
WASHINGTON | Tue Sep 6, 2011 10:46pm EDT
(Reuters) – President Barack Obama, facing waning confidence among Americans in his economic stewardship, plans to lay out a $300 billion job-creation package on Thursday, CNN reported, citing Democratic sources.
The proposed new spending, to be announced by Obama in a nationally televised speech to Congress, would be offset by budget cuts, the report said, signaling that the Democratic president hopes to mollify the concerns of Republican fiscal hawks resistant to his jobs ideas.
There was no immediate comment from the White House.
Obama’s aides have refused to go public with the estimated cost of Obama’s package or provide many specifics in advance, except to say that the proposals will have a “quick and positive” impact on boosting jobs at a time of stubbornly high U.S. unemployment.
Confidence in Obama’s management of the economy has been hit by months of bad economic news and several polls on Tuesday showed fresh declines in his job approval ratings.
Obama hopes to start reversing this trend in an address to a joint session of Congress on Thursday, in which he will try to convince voters that he has a better economic recovery plan than his Republican opponents.
“We need to do things that will have a direct impact in the short-term to grow the economy and create jobs and the president will put forward proposals that will do just that,” White House spokesman Jay Carney said.
Obama fought Republicans all summer to lift the U.S. debt ceiling in a bitter debate that saw rating agency Standard & Poor’s cut the U.S. AAA credit rating, and he must now get lawmakers to back additional spending that many oppose.
However, the president is seeking congressional support at a time when his own prospects of re-election have worsened.
An NBC News/Wall Street Journal poll showed Obama’s job approval rating at a low of 44 percent, while an ABC News/ Washington Post poll found that six in 10 Americans now rate the president’s job on the economy and jobs negatively.
A third survey by Politico and George Washington University found that 72 percent of voters believe the country is either strongly or somewhat headed in the wrong direction, a jump of 12 percent since last May.
Obama must get unemployment down from levels currently above 9 percent to improve his chances of winning a second White House term in the November 2012 election.
The president has already touched on a various steps Congress could take to lift growth and hiring, including infrastructure spending, business tax breaks, and extending a payroll tax cut and aid for the long-term unemployed.
Carney declined to lay out any specifics but said the measures Obama would recommend would yield a “direct, quick and positive impact” on the U.S. economy if they were enacted by Congress.
Republicans criticized Obama for not including them in discussions on the package before his big speech and indicated any jobs bills could face tough passage through Congress, where they control the U.S. House of Representatives.
“I have no doubt the president will propose many things on Thursday that, when looked at individually, sound pretty good, or that he’ll call them all bipartisan. I’m equally certain that, taken as whole, they’ll represent more of the same failed approach,” said the top Senate Republican, Mitch McConnell.
Republican House leaders separately wrote to Obama urging him to repeal “excessive, job-destroying regulations” and laying out possible areas of common ground, including reforms to the unemployment system and free trade agreements.
Courtesy to Reuters
Oil prices fall on continuing
global economy concerns
LAST UPDATED AT 05 SEP 2011, 18:00 GMT*CHART SHOWS LOCAL TIME
Oil prices have fallen on concerns that the US could fall back into recession, and continuing anxiety about eurozone debt levels.
With fears about a slowdown in China also hitting sentiment, US light crude had fallen $2.40 a barrel to $84.05.
Brent crude was also lower, dropping $1.66 to $110.67 per barrel.
The falls come after data on Friday showed that the US economy added no new jobs in August, a much worse reading than had been expected.
Analysts had predicted that the non-farm payrolls figures from the Department of Labor would show about 70,000 new jobs had been created.
The unemployment rate remained unchanged in August at 9.1%.
In Europe, the main share indexes were down sharply as concerns continue about the high debt levels of eurozone countries, and how these could impact on the wider economy.
Germany’s Dax index and France’s Cac were both 2.6% lower in morning trading.
Meanwhile, a report in China said that the country’s service sector grew in August at its slowest pace since records began.
“Oil is falling on worries over weak demand, unemployment and talk of a double dip recession,” said Eugen Weinberg, head of commodities research at Commerzbank in Frankfurt.
He added that oil prices would be falling further were it not for growing optimism that the US central bank, the Federal Reserve, will announce new measures later this month to try to stimulate the US economy.
Courtesy to BBC
05/09/2011 Web Story….
Samsung Puts New Galaxy Tab
By Jun Yang – Sep 5, 2011 5:09 AM GMT+0530
Samsung Electronics Co. lost a chance to showcase its latest tablet computer at one of the world’s largest electronics shows after Apple Inc. (AAPL) won a second injunction blocking Galaxy Tab sales inGermany.
Samsung, Apple’s closest rival in tablet computers, pulled the just-unveiled Galaxy Tab 7.7 out of the IFA consumer- electronics show in Berlin after a Dusseldorf court on Sept. 2 granted Apple’s request to ban sales and marketing of the product, James Chung, a Seoul-based spokesman for Samsung, said by telephone yesterday. Chung couldn’t confirm if Samsung has received the court order, while Steve Park, a Seoul-based spokesman for Apple, couldn’t immediately comment on the ruling.
“Samsung respects the court’s decision,” Chung said, adding that the company believes it “severely limits consumer choice inGermany.” Samsung will pursue all available options, including legal action, to defend its intellectual property rights, he said.
Samsung and Apple, maker of the iPad, are involved in legal disputes across three continents, as Apple — also one of the biggest customers for the South Korean manufacturer’s chips and displays — claims the Galaxy devices copied its iPhone and iPad. Last month, theDusseldorfRegional Court granted Apple a temporary sales ban on the earlier Galaxy Tab 10.1 model in 26 of the 27 European Union member countries.
Samsung shares fell 0.3 percent to 769,000 won on Sept. 2 in Seoultrading, extending their drop to 19 percent this year.
The August ruling, scaled back to only Germany on jurisdictional grounds, could have cost Samsung sales of as many as half a million units this year, according to an estimate byStrategy Analytics.
Samsung had planned to show the Galaxy Tab 7.7 along with other mobile devices at this year’s IFA, which has become a battleground for companies seeking to lure European consumers to alternatives to the iPhone and the iPad.
The South Korean company, which doesn’t disclose how many tablets it has sold, aims to increase sales of tablet computers more than fivefold this year from 2010, when the original Galaxy Tab running Google Inc. (GOOG)’s Android software went on sale.
Samsung had about a 16 percent share in the tablet market in the first quarter, trailing the iPad’s 69 percent, according to Strategy Analytics.
Legal disputes between the two technology companies began after Apple charged Samsung with “slavishly” copying its products in an April suit filed in the U.S. Samsung, which holds the second-largest number of patents in the U.S., countersued in Seoul, Tokyo,Germany andCalifornia.
A court ruling in theNetherlandson Aug. 25 ordered Samsung to halt some sales of its smartphones after Oct. 13.
In Australia, Samsung agreed to push back introduction of the Galaxy Tab 10.1 until the end of September, the second delay in a month.
Courtesy to Bloomberg