What would it take to make international finance safe?

Lots of things, but one thing for sure is a true international lender-of-last-resort (ILLR).  When domestic financial markets are gripped by panic, domestic central banks play a critical role in restoring stability because they stand ready to extend liquidity to banks.  Just think how much worse the current crisis would have been in the U.S. if the Fed had not been there to enlarge its balance sheet by leaps and bounds. 

In the international sphere, there is no equivalent. So when countries suffer what Guillermo Calvo has called a "sudden stop" in capital flows, often through no fault of their own, they have to take it on the chin and bear it.  There is the IMF of course, but it has traditionally operated in a way that is very different from a lender-of-last-resort.  The amount it lends is limited, it takes a while to get the money, and the money comes with lots of strings attached. 

As Calvo points out, the recent G-20 summit has resulted in some decisions that may well change all that.  The IMF is getting a lot of new resources at its disposal (a tripling of its lending capacity, plus the possibility, for the first time, of going to markets to borrow).  It is also revising its lending policies in order to respond more quickly and (at least for certain countries) with less or no conditionality. 

This is all for good, and it promises to plug a significant hole in the international financial architecture.  But as Calvo also points out, it still remains to be seen how the IMF will operate and whether the new resources at its disposal will be adequate in light of the scale of the financing needs emerging and developing countries face.  (Turkey, which has long been negotiating with the IMF for a loan, may well be the first important test case for the new IMF.)

While I think these changes are all in the right direction, I worry that they will fall far short of converting the IMF into a true lender of last resort.  I just cannot imagine that the Americans and the Europeans will allow the Fund to lend at will--even for countries that are taken to be "behaving well."  And I also worry about so called ex-ante conditionality--the stamp of approval that countries will need to qualify for these fast-disbursing lines of credit.  The IMF has a patchy record with respect to being able to evaluate risks ex ante.  It also has too rigid views on what counts as "sound policies." 

So I remain convinced that we still need a Plan B for global finance--one that places less confidence on us getting the international institutions to work right and one that allows greater room for countries to protect themselves from financial whiplash through managed capital flows.     

Comments

[raivo pommer-www.google.ee]

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EUROZONE

Die Talfahrt der Wirtschaft in der Eurozone hat sich nach Einschätzung von Wirtschaftsforschern aus Deutschland, Frankreich und Italien zum Jahresstart beschleunigt.

«Die Aussichten für die wirtschaftliche Entwicklung bleiben trotz der Umsetzung der staatlichen Konjunkturpakete düster», heißt es in einer am Dienstag veröffentlichten gemeinsamen Konjunkturprognose des Münchner ifo- Instituts, der französischen Statistikbehörde Insee und des italienischen Wirtschaftsforschungsinstituts ISAE.

Die Eurozone befinde sich in einer schweren Rezession. Der Rückgang des Bruttoinlandsprodukts (BIP) in der Eurozone werde sich im ersten Quartal auf 1,9 (4. Quartal 2008: minus 1,6) Prozent beschleunigen, ehe die Wirtschaftsleistung im zweiten Quartal um 0,6 Prozent und im dritten Quartal um 0,2 Prozent sinke.

Der private Konsum werde abnehmen, insbesondere, da sich die Entwicklung der real verfügbaren Einkommen spürbar verschlechtern dürfte, heißt es in der Studie. Auch die Investitionen dürften nach ihrem Einbruch gegen Ende des Jahres 2008 weiter kräftig fallen. Zum einen bleibe die Lage auf den Finanzmärkten unverändert angespannt; zum anderen dürfte die Unterauslastung der Kapazitäten stark belastend wirken.

Die Inflationsrate werde unter der Annahme, dass der Ölpreis um 45 Dollar schwanke und sich der Wechselkurs bei 1,35 Dollar je Euro stabilisiere, im Juni und September 2009 bei je minus 0,2 Prozent liegen. Die Gefahr einer Deflation bestehe momentan nicht, da die Kerninflationsrate deutlich positiv bleibe.

[raivo pommer-www.google.ee]

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Royal Bank of Scotland

streicht 9000 Stellen
Die Hälfte der Jobs soll in Großbritannien wegfallen: Die weitgehend verstaatlichte Royal Bank of Scotland (RBS) will in den kommenden zwei Jahren weitere 9000 Stellen abbauen. 2008 hatte die Bank mit 24,1 Milliarden Pfund den größten Verlust in der britischen Wirtschaftsgeschichte geschrieben.
Ein Schutzmann vor einer Filiale der Royal Bank of Scotland in London: Während der G20-Proteste vergangene Woche richtete sich die Wut auch gegen die verstaatlichte Bank.

Beratungen mit den Gewerkschaften hätten bereits begonnen, teilte die Bank am Dienstag mit. Die Hälfte der Jobs soll in Großbritannien wegfallen.

Bereits in den vergangenen Monaten hatte die britische Großbank den Abbau von 2700 Jobs angekündigt. Weltweit beschäftigt RBS rund 180.000 Menschen.

Wegen der Finanzkrise war die RBS in eine extreme Schieflage geraten und hatte im vergangenen Jahr mit 24,1 Milliarden Pfund (26,6 Mrd Euro) den größten Verlust in der britischen Wirtschaftsgeschichte verzeichnet.

[Phillip Huggan]

Right now everyone looks to the Ratings Agencies for investment advice. These agencies only get paid if they give bad advice, the type of advice that unemploys tens of millions.
Couldn't a solution here be as simple as paying them to give good advice? Like, paying them to look at what companies might trigger massive unemployment by by making a recession worse or making a bubble bigger?

If someone were to get paid to look at what financial instruments and practises and managers will make a recession worse, and to assign a credit rating to the entity that penalized pro-cyclicality portfolio holdings or opaqueness in the face of derivative assets....it would be friggin miracle.
I get the impression any child can run a finance company but it takes a real man to collect the bonus.

[Etienne Calame]

Speculationism:

Hello to everyone from sunny Izmir, I read some papers last weeks, as everyone did, that capitalism is at an end or must change. I do not think that the crisis is a consequence of capitalism, just like one can not prevent earthquake but should build a stronger house we can not prevent crisis juts have to build a stronger economy. The point is therefore not capitalism but speculationism. The last decades saw growing trends to have companies bought by equities and run by finance guys. The main strategy is to rob customers while stabbing suppliers, spreading “good news” so stocks rockets and the whole pays back a fortune when sold. A “true” company owner think long term, for his retirement and children future, he tales care and evaluate risk so the business will last, long term profit takes over short terms gains.
The finance guys do not care because there are always mismanaged companies to buy for cheap, they think only short term profit.
I think capitalism is when the capital is rewarded for its contribution to the country productivity, but when one makes profit on cacao or coffee before even it turns into chocolate or espresso this is not capitalism this is only speculationism. That makes the African guy poor, that makes the American worker poor, and a handful of people in the middle indecently rich, so rich that they can even not count their money, and never will be able to spent it.
The solution is to incentive capital investment in production and penalizes speculation… if one can “convince” the owners of this sort of capital to take “true” risks. This will never avoid crisis to occur but this will certainly decrease the damage it can make.

[raivo pommer-www.google.ee.]

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FRISCHES GELD

Die in finanzielle Bedrängnis geratene Schaeffler-Gruppe hat nach eigenen Angaben mit ihren Banken einen Kreditvertrag über eine Milliarde Euro geschlossen.
Grossbild

Die hoch verschuldete Schaeffler Gruppe hat mit ihren Banken einen Kreditvertrag über eine Milliarde Euro geschlossen. "Damit sichern wir weiteren Handlungsspielraum", teilte Klaus Rosenfeld, Finanzvorstand der Schaeffler Gruppe, in Herzogenaurach mit. Über die Details des Kreditvertrages sei Stillschweigen vereinbart worden.

Schaeffler hatte sich für die Übernahme des börsennotierten Wettbewerbers Continental in Milliarden-Schulden gestürzt und konnte zuletzt die monatlich auflaufenden Zinsen von 70 Millionen Euro nur noch schwer stemmen. Erschwerend kam hinzu, dass Conti seinerseits auf einem Schuldenberg sitzt.

[Tincho]

I would like to kwon what do you mean by "managed capital flows". Capital controls or something else?

[raivo pommer-eesti.www.google.ee.]

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EURO KRISIS

Der Kurs des Euro EURUS.FX1 hat sich am Mittwoch im Nachmittagshandel stabilisiert. Zuletzt wurden für die Gemeinschaftswährung 1,3242 US-Dollar gezahlt, nachdem der Euro im frühen Handel noch bis auf 1,3145 Dollar gefallen war. Die Europäische Zentralbank (EZB) hatte den Referenzkurs am Mittag auf 1,3231 (Dienstag: 1,3255) Dollar festgesetzt. Der Dollar kostete damit 0,7558 (0,7544) Euro.

Zunächst hatten schwächelnde Aktienmärkte den Euro belastet. "Als die Aktienkurse im Zuge der Bekanntgabe der ersten Ergebnisse für das erste Quartal 2009 ins Trudeln gerieten, nahm die Risikoaversion zu und schon ging es für den Euro abwärts", erklärten die Experten der HSH Nordbank die Kursentwicklung. "Möglicherweise hält das Protokoll der letzten Sitzung des geldpolitischen Ausschusses der US-Notenbank Fed noch etwas Neues bereit", so die HSH Nordbank und hofft auf eine Begründung für den Ankauf von 300 Milliarden Dollar an Staatsanleihen. Die Auswirkungen auf den Devisenmarkt sollten sich den Experten zufolge allerdings in Grenzen halten.

Devisenexperte Klaus Gölitz von M.M. Warburg verwies ebenfalls auf die Aktienmärkte als Impulsgeber. "Derzeit ist Euro/Dollar ein Spiegelbild des DAX und des Futures auf den Dow Jones . Mit der Erholung der Aktienmärkte ging es auch für den Euro wieder etwas nach oben", sagte Gölitz. Insgesamt sei die Grundstimmung aber relativ ruhig. Die Positionen auf dem Devisenmarkt seien seit dem G20-Gipfel relativ ausgewogen und die Volatilität sei vor dem langen Osterwochenende deutlich zurückgekommen.

[raivo pommer-eesti.]

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DAX 4500

Der deutschen Aktienindex DAX hat die verkürzte Osterwoche mit kräftigen Gewinnen beendet. Überraschend positive Nachrichten verhalfen dem Leitindex am Donnerstag sogar zeitweise über die Marke von 4500 Punkten.

Halten konnte er sie jedoch nicht, sondern schloss mit einem Aufschlag von 3,06 Prozent bei 4491,12 Zählern knapp darunter. Im Wochenverlauf belief sich das Plus auf rund 2,5 Prozent. Der MDAX der mittelgroßen Werte gewann am Gründonnerstag 4,41 Prozent auf 5008,65 Punkte. Der TecDAX rückte um 4,33 Prozent auf 534,18 Zähler vor.

[raivo pommer-eesti.]

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OeNB Bank in WIEN

Durch die Brisanz der Affäre rund um die Immobilienfirma Meinl European Land (MEL, heute Atrium Real Estate) ist auch der Wirtschaftsprüfer Philip Göth wieder ins Zentrum des öffentlichen Interesses gerückt.

Göth sitzt im Aufsichtsgremium der Oesterreichischen Nationalbank (OeNB) – dem Generalrat – und hat Ende 2006 per Gutachten den börsegehandelten MEL-Papieren bescheinigt, "zur teilweisen Veranlagung von Mündelgeld" geeignet zu sein. Mittlerweile haben Anleger viel Geld mit dem verloren, was Göth als "MEL-Aktie" bezeichnete, obwohl es sich dabei um Zertifikate gehandelt hat. Konsumentenschützer werfen Meinl vor, zu Unrecht mit der Mündelsicherheit geworben zu haben.

Es könne nicht sein, dass Göth weiterhin als Generalrat der OeNB tätig sei, poltert SPÖ-Finanzsprecher Jan Krainer. Neben dem MEL-Gutachten stößt sich Krainer auch an Göths Rolle als Aufsichtsrat der Bank Medici – jenes Wiener Institutes, das Fonds des mutmaßlichen US-Milliardenbetrügers Bernard Madoff vertrieben hat.

[raivo pommer-eesti.]

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Japan 150 Milliard

Der japanische Ministerpräsident Taro Aso hat heute ein neues Konjunkturpaket im Umfang von 150 Milliarden Dollar vorgestellt.

In der Landeswährung sind das 15 Billionen Yen, in Franken 174 Milliarden. Zwei frühere Konjunkturpakete hatten einen Umfang von zusammen 12 Billionen Yen. Finanziert werden sollen die staatlichen Stützungsmassnahmen mit der Ausgabe neuer Anleihen.

Es gehe darum, den Lebensstandard der Bevölkerung zu sichern und weiteres Wachstum zu unterstützen, sagte Aso in einer Fernsehansprache. Die neuen Ausgaben haben ein Volumen von etwa drei Prozent des Bruttoinlandsprodukts. Die japanische Staatsverschuldung beträgt zurzeit 170 Prozent des Bruttoinlandsprodukts und ist damit so hoch wie in keinem anderen Industriestaat.

[raivo pommer-eesti.]

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PARIS CRISIS

Paris, the most-visited city in the world, is getting clobbered by a sharp downturn in global travel. International passenger arrivals at the city's two airports were down 8.1 percent year-on-year in February, and hotel occupancy rates dropped 10 percent. Even visits to the Eiffel Tower have fallen 7 percent from last year. (Overall, the US Commerce Dept. figures visits by Americans to Europe tumbled 7 percent last year.)

That's putting a big dent in the city's $13.2 billion-a-year hotel and restaurant business, which, along with other tourism-related activities, employs 12.1 percent of the city's population. "It's a catastrophe," says Bertrand LeCourt, president of l'Hôtellerie Familiale, a hotel owners' association.

Empty Rooms and Tables

It's not just sightseers who are staying away. Business travel held up relatively well during 2008, because many conventions and trade shows were planned well in advance. But now it's slumping, too. "February really scared us," said Gérard Cros, owner of the Sport Hotel, a 95-year-old establishment near the Bois de Vincennes that caters to business travelers. Occupancy at the hotel in February was down 10 percent from a year earlier, Cros says.

[raivo pommer-eesti.]

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PEUGEOT CRISE

The board of PSA, Europe's No. 2 automaker after Volkswagen, cited "the extraordinary difficulties currently faced by the automotive industry" as its reason for replacing Streiff with Philippe Varin, currently the boss of steelmaker Corus. But Streiff, 54, had alienated other top PSA managers and infuriated the French government by vowing to shrink the group's payroll-even after receiving a nearly $4 billion government bailout that was supposed to protect jobs.

Although rumors had circulated for weeks that Streiff's job was in danger, the announcement clearly caught him off guard. Through an outside spokesman, he issued a statement calling the board's decision "incomprehensible," adding, "The policies we defined and put in place over the past two years have left PSA well-armed against the current crisis." Investors didn't seem happy, either: PSA shares sank more than 9 percent on the news of Streiff's departure.

[Per Kurowski]

Danny Rodrik asks “What would it take to make international finance safe?”

As I see it the first requisite is to get rid of the belief that something can be absolutely safe, like that which gave AIG its AAA ratings and which was precisely what led it to take on unimaginable risks.

Dear PhD Rodrik… are you also really sure you would even want to make international finance safe? What for? Just to have all the world living in a tenured cocoon? Just to have few financial institutions growing larger and larger until they outgrow themselves?

No, international and national finance should not be safe, but what we must make sure is that those that fail fail fast, hopefully before they become too large.

Danny Rodrik’s “A plan B for global finance” points in the right direction but when he says “Basel 1 ended up encouraging risky short-term borrowing, whereas Basel 2’s reliance on credit ratings and banks’ own models to generate risk weights for capital requirements is clearly inappropriate in light of recent experience” he ignores the fundamental issue that we need regulators with sufficient wisdom to have known that without the “light of recent experience”.

Get rid of the current generation of regulators... they are clearly a failed bunch. What about some accountability.

[raivo pommer-eesti.]

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OIL IRAQ

With security in Iraq improving, international oil companies are quickly moving in, often with little or no fanfare. Hanter Gasser, Royal Dutch Shell's (RDS) top executive for Iraq, recently spent a week in Basra, site of the country's biggest fields, checking on a joint venture Shell is starting with the Iraqis to find commercial uses for the gas that is flared off during oil production. Gasser says Iraq burns off enough gas to power two countries the size of Jordan.

Iraqi police officers protecting oil installations north of Basra.
Shell is one of about 30 oil companies, including ExxonMobil, Chevron, and BP, that are pursuing licensing agreements with Baghdad. Iraq intends to boost production in seven fields holding an estimated 44 billion barrels of reserves, more than a third of its total. Those agreements are supposed to be awarded in a few months. "We have high interest in Iraq, and we are waiting to see the terms," Gasser says. Iraqi oil production, at a low 2.5 million barrels a day, is just where it was before the war. If Iraq produced anywhere near its targeted 6 million barrels a day, it could change the industry's dynamics and curb talk of a looming shortage.

[raivo pommer-eesti.]

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NOKIA INDIA

Gearing up to meet the challenges of next generation mobile services - 3G, the world's largest handset maker, Nokia, today announced a
slew of new services like music online and location based services to be made available on its new phones, to be launched shortly.

"We are moving away from just devices to devices plus services plus solutions. With the 3G mobile services set to make advent by the middle of next year, we feel that revenue from non-voice services is bound to increase significantly," Nokia India Ltd Vice-President and General Manager D Shivakumar told reporters here.

Asked whether Nokia is planning to acquire some of the content providers to enhance services, Shivakumar said "there is no plan for any acquisition but it will be done through a collaboration with the innovators."

He, however, said that there would be significant investment in ramping up the facilities but declined to give details.

In fact, Nokia called upon Indian mobile and web application developers to create innovative consumer applications exclusively for the upcoming handset N97.

[raivo pommer-eesti.]

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REZESSION IN MICROSOFT

Der weltgrößte Softwarekonzern Microsoft hat durch die Krise am PC-Markt einen herben Gewinneinbruch erlitten. Der Überschuss brach im abgelaufenen Quartal um fast ein Drittel auf knapp 3,0 Milliarden Dollar (2,3 Mrd Euro) ein. Der Umsatz fiel um sechs Prozent auf 13,6 Milliarden Dollar, wie der US-Konzern am Donnerstag nach Börsenschluss am Sitz in Redmond (Bundesstaat Washington) mitteilte. Das ist der erste Rückgang der Quartalserlöse im Jahresvergleich seit der Windows-Konzern Anfang 1986 an die Börse ging.

Microsoft rechnet überdies nicht mit einer schnellen Besserung am Markt. "Wir erwarten, dass die Schwäche mindestens bis ins nächste Quartal anhält", sagte Finanzchef Chris Liddell. Mit seinen Zahlen enttäuschte der Softwareriese die Erwartungen der Analysten.

Der PC-Absatz war im ersten Quartal laut den Marktforschern von Gartner um 6,5 Prozent geschrumpft. Werden weniger Computer verkauft, kann Microsoft damit zum Beispiel auch sein Betriebssystem Windows seltener absetzen. Außerdem sind immer mehr der verkauften Computer Mini-Notebooks, von denen zahlreiche nicht mit Windows, sondern mit dem freien Betriebssystem Linux laufen.

[raivo pommer-eesti.]

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CALAIS

French immigration minister Eric Besson pledged today to remove a camp where illegal migrants gather near the port of Calais to try crossing to Britain.

The "jungle", as the makeshift tent city is known locally, sprang up after France closed a large Red Cross centre at nearby Sangatte in 2002, under pressure from Britain which saw it as a magnet for clandestine migrants.

"The jungle will no longer exist," Mr Besson told local business leaders during a visit to Calais.

"To maintain and develop the jungle would be an obstacle to economic interests and employment," he said.

Mr Besson was due to make a speech later outlining specific measures. His visit to Calais comes two days after police and bulldozers swooped on the camp, arresting about 200 migrants and removing their tents made of plastic sheeting and bits of wood.

The raid angered human rights activists who said it made no sense to clear out the "jungle" as migrants would simply relocate elsewhere in the area, as they did after Sangatte was closed. France and Britain should be looking for more sustainable solutions, they said.

[raivo pommer-eesti.]

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SLOW- MOTION

Federal regulators on Friday will privately begin telling the 19 largest US financial institutions how well they performed in stress
tests to assess their soundness.

Regulators trying to stabilize the financial system also will release the test methodology they used, which could provide clues about which banks may be in trouble - but also could could unwittingly roil the industry.

The results of the stress tests won't be publicly released until May 4.

The slow-motion rollout is intended to blunt market reaction to the news of which banks are healthy, which ones could fail if the recession worsens and which need more money to survive.

News reports, including a confidential outline of the tests first reported by The Associated Press this week, have led analysts to start handicapping which banks could fail. The speculation will intensify with Friday's release of the test methodology.

``I'm worried about the overreaction - people selling every bank short and pulling out all their deposits and hiding their money in the mattress,'' said Scott Talbott, a lobbyist with the Financial Services Roundtable, which represents the biggest financial firms.

Regulators are striving to release enough information about the stress tests to inspire confidence. But they don't want to give analysts so much detail that they can run their own tests on the banks before the official release of results.

[raivo pommer-eesti.]

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BRITISH CHRISE

Equally, it may be true that British GDP will be lower than the government forecasts by the middle of the next decade - credit crunches are much harder to slip away from than the government forecasts. But after the stimulus the economy has received, there should be some growth, broadly corresponding to the shape the Treasury predicts.

The real issue is the evaporation of our economic and political pretensions. The Treasury has been forced to recognise that 5% of Britain's GDP has disappeared forever. Too many industries were dependent upon the crazy world of ever-rising house prices and easy credit; now gone for ever. This means that the path to sustainable public finances is going to be astonishingly painful. We can live with national debt doubling, but it cannot double again.

The numbers are terrifying. Budget deficits, even for Keynesian apostles of deficit finance like me, cannot stay at 12% of GDP, or £175bn, for very long, however justifiable in recession. The problem is that so much economic capacity has permanently disappeared, along with those parts of the economy that used to deliver rich tax revenues; the post-recession economy will only reduce the deficit by a quarter. The rest has got to be found by tax increases or reductions in planned spending.

[raivo pommer-eesti.]

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US-BANKEN

The United States pledged robust support Saturday for an overhaul of governing power within the International Monetary Fund so key emerging-market nations get more say in how the lender operates.

In a speech to the IMF's steering committee, Treasury Secretary Timothy Geithner also called on the fund to be prepared to offer loans to recapitalize banks or to aid developing countries in rolling over corporate debt.

Geithner's proposals, delivered in a strongly worded address at the IMF's semiannual meeting, are likely to provoke some controversy among the other industralized countries who, with the United States, have long dominated the global lender.

He said, however, it was necessary to retool the IMF to reflect a shift in global economic reality.

"This is essential to strengthening the IMF's legitimacy, ensuring that it remains at the center of the international monetary system and reflects the realities of the 21st century," Geithner said.

Washington's commitment to reform carries special weight because it is the biggest single shareholder within the IMF.

[raivo pommer-eesti.]

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AMERICA-EUROPE

Barack Obama is unhappy with much that preceded his occupation of the White House, and not only his predecessor’s foreign policy, for which he is a serial apologiser. Pre-Obama domestic policy also displeases him: any prosperity the nation enjoyed, he says, was built on a foundation of sand. That, won’t happen again: the trillions of debt he is loading on the nation’s books will enable us to erect our post-recession house on solid rock. Our world will never be the same again.

Of course, it never has been: the march of technology has enabled us to travel faster, age more slowly, entertain ourselves differently, and build air-conditioned homes in the miserably hot south and southwest, and in our nation’s steamy capital. But the president has something more in mind and, with control of both houses of Congress, the power to change the way we live now. Let’s make a few guesses as to where those changes will take us.

Top of the president’s change list is the way we consume energy. He believes our use of carbon-based fuels is causing the globe to heat up, with all the dire consequences conjured up by Al Gore as he sits in the library of his home, probably the largest single consumer of energy of any private residence in America. By one means or another, the president will make the use of oil, natural gas and especially coal so expensive that consumers will be forced to use less energy, and rely more for the energy we do use on costly wind and solar power, paid for with tax-funded subsidies or higher utility bills.

[raivo pommer-eesti.]

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WORLDCRISE

Lady Godiva's legendary ride naked through Coventry was perhaps one of the most effective anti-tax demonstrations in history. Her tyrannical husband, Earl Leofric, had imposed an oppressive tax called the Heregeld to pay for the King’s bodyguard.

After pleading with him to repeal the tax, Leofric replied: "You will have to ride naked through Coventry before I will change my ways". So Godiva took him at his word – after ordering the town to close all their windows and doors, she rode through the town with only her long golden hair as her cover. True to his word, Godiva’s husband repealed the hated tax.

2. 1773: Colonial taxes

The Boston Tea party was not a party, but a demonstration against the unfair taxation of colonies. The British Government gave the British East India Company, an English trade company, far more beneficial tax arrangements than its colonial competitors.

Demonstrators in Boston became particularly fed-up with this, and one night a group of protestors sneaked onboard a docked British East India Company ship and unloaded 45 tons of tea (worth an estimated £10,000 - that is about £953,000 today) into the sea. The event ultimately helped spark the American Revolution and the loss of America to the British Empire.

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The current crisis may mean he is about 10 years out – but, still, not a bad prediction for a man who died in 1938.

HousePriceCrash.co.uk was established in October 2003 after its founders predicted “one of the potentially biggest economic boom bust events in living memory” was coming. Its aim, apparently, is to provide a “counterbalance to the huge amounts of positive spin the housing market receives in the main media”.

Whist there is not currently a lot of positive news about the housing market to counter, the site does provide a plethora of information, statistics and forums for those interested in the great house price crash.

He may not have predicted the entire financial meltdown, but he did warn the Government of the possible collapse of Icelandic banks back in July. He said last week: “"Alarm bells were ringing all over about the Icelandic banks and the Treasury must have been blind and deaf not to hear them."

In a written question to the government in July, he asked: "What steps [have] the United Kingdom financial authorities taken to satisfy themselves, independently of the Icelandic financial authorities, of the solvency and stability of Icelandic banks taking deposits in the United Kingdom?”

Lord Davies, for the Government, replied that there was no concern about the liquidity or capital base of Icelandic banks operating in the UK.

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CHINA GOLD

Die Volksrepublik China hat ihre Goldreserven seit dem Jahr 2003 von 600 auf 1.054 Tonnen aufgestockt. Das teilte der Leiter der Verwaltung der Währungsreserven, Hu Xiaolian, der chinesischen Nachrichtenagentur Xinhua mit.

Peking hatte in den vergangenen Jahren keine präzisen Angaben über seine Goldreserven gemacht. Marktkenner vermuteten allerdings schon länger, dass Peking seine Reserven ausbauen würde. Der Goldpreis legte am Freitag in Reaktion auf die Meldung aus China leicht zu. Kurz nach Eröffnung des New Yorker Handels kostete die Unze dort 908 Dollar. Der HUI-Index (Amex Gold Bugs Index) führender Goldminenwerte verbesserte sich zu Handelsbeginn um 3 Prozent auf 299 Punkte. Ende März hatte der Index noch 342 Punkte erreicht.

Leichte Diversifizierung der riesigen Währungsreserven

Wie Hu Xiaolian sagte, erfolgte der Reservenaufbau überwiegend durch Käufe von in China selbst gefördertem Gold. China gehört seit Jahren zu den wichtigsten Förderländern der Welt. Mit ihren Reserven von 1.054 Tonnen übertrifft die Volksrepublik die Schweiz, die Reserven von 1.040 Tonnen ausweist. Innerhalb der chinesischen Währungsreserven von rund 2.000 Milliarden Dollar spielt Gold aber nach wie vor nur eine bescheidene Rolle: Der Marktwert der Goldreserven beträgt lediglich gut 30 Milliarden Dollar.

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The biggest German bank, Deutsche Bank, posted on Tuesday strong first quarter results, the latest major bank in Europe and North
America to offer hope for an eventual end to the financial crisis.

Deutsche Bank reported a net profit of 1.2 billion euros ($1.56 billion), far surpassing market expectations.

In the first quarter of 2008, Deutsche Bank had posted a net loss of 141 million euros, and analysts polled by Dow Jones Newswires had forecast a net profit of 764 million euros this time around.

Bank chairman Josef Ackermann said: "This was a key quarter for Deutsche Bank. Once again we demonstrated our strength, as we have consistently throughout this crisis. "But in this quarter, we also proved our earnings power."

Deutsche Bank is the latest global bank to report solid first quarter results, along with peers such as Bank of America, Goldman Sachs and Credit Suisse, giving a glimmer of hope that the financial crisis could be past the worst.

[raivo pommer-eesti.]

Im Jahr 1954 das Flaggschiff der Gesellschaft.

Nur drei Fondsmanager hat es seitdem vor Sweeting gegeben, darunter Sir John Templeton, den Firmengründer. Er hat die Investmententscheidungen des Fonds mehr als 30 Jahre lang selbst gefällt, bevor er 1987 andere ans Ruder lies

Sweeting führt die Geschäfte seit Anfang vergangenen Jahres. Sie hat keine leichte Zeit erwischt. Denn seit einigen Jahren läuft der einst 40 Milliarden schwere Templeton Growth der internationalen Marktentwicklung hinterher. So gab der Fonds in Euro gerechnet allein im ersten Quartal des Jahres 41 Prozent nach, der Vergleichsindex büßte dagegen 37 Prozent ein. Auch auf Fünfjahressicht schneidet der Templeton Growth Fund schlechter ab als der Aktienindex MSCI Welt.

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[Robert]

I would agree with the idea that we need to somehow curb the impact that one countries financial situation can impact another. But as the world becomes smaller, neighbours are going to have a greater affect on each other.

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