Britain shivers as US hits recession

AMERICA’s economy is definitely in recession, economists say, amid growing fears that the credit crunch is entering its most dangerous phase. Figures on Friday showing a second successive monthly fall in US employment sealed the question of whether America had entered its first recession since the 2001 downturn. The US lost 63,000 jobs in February, […]

Inflation Killed by Recession? Don’t Count on It!

Worried about inflation? Oh stop your carping and set an extra place at dinner for the fast-looming recession instead. See, your cost of living can’t possibly keep rising now that Europe and the United States are plunging into a credit-led slowdown. Inflation is dead, killed by the slump. The value of money is going to […]

Why the Dollar is Falling: Recession Gets Priority Over Inflation

“The first quarter will be ugly,” said an analyst at Deutschebank after looking at the latest report on the fourth quarter. In the last three months of 2007, the U.S. economy neither grew nor shrank. Instead, it just came to a halt. The official report shows GDP rising at an annual rate of 0.6%. The […]

Another finance company hits wall

A 15th finance company has hit the wall and is asking its debenture holders to vote on a 20-month wind down to stop it from going to the receivers. New Zealand property finance firm MFS Boston, an indirectly owned subsidiary of troubled Australian firm MFS, announced the moratorium proposal yesterday and will hold a meeting […]

Omens of recession seen in economy

New Zealand faces conditions that are eerily similar to those which preceded the 1998 recession, the Bank of New Zealand says. The bank is forecasting a slowdown, but not a recession, this year but it says the risks to the economic outlook are “massive”. “On top of a worsening global backdrop and a weaker-than-expected local […]

Gold nears $1,000 as stagflation fears grow

Gold hit a record $953.60 a troy ounce on Thursday as oil’s move above $100 and inflation fears provided fresh upward momentum. Fuelling the rally were fears the US economy could be heading for stag­flation after the Federal Reserve published forecasts for lower growth and higher inflation. Read more

For Japan, a Long, Slow Slide

By Blaine Harden Washington Post Foreign Service Sunday, February 3, 2008; Page A17TOKYO — As the United States frets noisily about a recession, Japan is quietly enduring a far more fundamental economic slide, one that seems irreversible. This country, which got rich quick in a postwar miracle of manufacturing and alarmed Americans by buying up […]

Stagflation is Here

War—after all, what is it that the people get? Why—widows, taxes, wooden legs and debt. Samuel B. Pettengill “Armies, and debts, and taxes are the known instruments for bringing the many under the domination of the few. James Madison, 4th U.S. President (April 20, 1795) “Let me issue and control a nation’s currency and I […]

New Zealand well-prepared for global slowdown

Placing this article does not mean I endorse labour. But I do think that the fiscal conservancy of labor has placed this country relatively better placed to weather the coming storm than other countries like the US and Australia. Thursday, 24 January 2008, 10:14 am Opinion: New Zealand Government Hon Dr Michael Cullen Minister of […]

Is This The Big One?

By Mike Whitney 21/01/08 “ICH” — – On Monday, fears of a US recession spilled over into Asian markets sending stocks tumbling. Indexes were hammered across the board in what turned out to be the worst day of trading since 2001. In India, the Bombay Sensitive Index plunged 1408 points, to 17,605. In China, the […]

Shares suffer biggest fall since 9/11

The FTSE 100 on Monday suffered its biggest one-day fall since the attacks on the World Trade Centre more than six years ago as the worst fears about the prospects for the global economy took hold. In a tumultuous session, the index was down as much as 5.7 per cent to 5,571.0 as dealers capitulated […]

‘Shocking’ sales results from M&S deepen fears of recession in UK

Pressure mounts for rate cut; Forward sales slump at Persimmon; UK economy ‘vulnerable’ By Sean O’Grady, Economics Editor and Nikhil Kumar Published: 10 January 2008 Fears of a consumer recession hit stock marketsyesterday after Marks & Spencer’s third-quarter trading results were described as “shocking” by analysts, while the influential World Economic Forum warned that the UK […]

China to Dump US Dollar as Confidence in Local Market Grows

“To the average American, nothing much has changed in the financial world… “According to ‘Business News’ on PBS, everything is actually OK – there is nothing to worry about. In fact, during the middle of 2008, all problems will be solved. But when will the Chinese ever dump their US treasury debts?” A good question: […]

Mortgages cause sleepless nights for homeowners

Home owners are becoming increasingly uneasy about keeping up with their mortgage repayments, a Research New Zealand survey says. The poll found home loan interest rates were a concern for 68 per cent of those with mortgages. The survey of social attitudes asked those with home loans if they were concerned that rising mortgage interest […]

Chinese Stock Market Boom A Panic Waiting To Happen

Posted by Dan Denning on Apr 30th, 2007 Is China’s fantastic bull market just an extension of the world’s tawdry and very public love affair with cheap credit? We’ll begin to find out this week as the Bank of China again raised reserve requirements at commercial banks. This is meant to reduce bank lending in […]

Interest rate increases have ‘gone too far’

The Reserve Bank has “definitely overdone” interest rate rises this year and should slash the rates in line with Australia, economic forecasting group Berl says. Instead of being on “perpetual inflation alert”, rates should be lowered to encourage investment, productivity improvements or business expansion, Berl says. “The psychotic fear of inflation is clouding the need […]

Investor panic takes toll on Speirs Group

Palmerston North-based loss-making finance company Speirs Group says its investor roll has plummeted 35% in the past three months, its secured stock funding has reduced and it is grappling with the collapse of its rental car client. Speirs Group, made up of Speirs Finance, Speirs Nutritionals and Spiers Foods, posted a loss of $1.9 million […]

Prepare for prolonged turmoil, says US Treasury Secretary

From The Times September 18, 2007 Suzy Jagger and Gabriel Rozenberg Investors should brace themselves for a prolonged period of market turmoil, Henry Paulson, the US Treasury Secretary, said yesterday as he held emergency meetings with the Chancellor and the French Finance Minister. Mr Paulson flew to London to discuss the financial crisis with Alistair […]

Investors to blame for not assessing the risks

The United States is not the only nation confronting a household debt crisis. We, too, have a subprime lending market and it is managed by our collective bag of finance companies. The collective sum of savings at risk in this sector is reported to be $16 billion. Put another way, that’s nearly a third of […]

Cullen planned $1 billion in tax cuts

The Government planned to deliver $1 billion in personal tax cuts at the last budget, but shelved the plan due to fears it would fuel inflation, official papers show. The papers, issued under the Official Information Act, show the Government last year considered a package of personal tax cuts that would have equalled the $1 […]

Credit crisis: Meltdown!

In the past 100 years, the rollercoaster ride that is the world of high finance has seen some spectacular lows. Sean O’Grady looks back at four episodes that not only came to define their times but also served as lessons for the future Published: 15 September 2007 1907: The Bankers’ Panic Sometimes, all that is necessary […]

Bank of England in dramatic intervention

 Northern Rock forced to seek emergency funding · Savers are assured that their money is secure Ashley Seager Friday September 14, 2007 The Guardian The Bank of England was last night forced to hand emergency funding to one of Britain’s biggest mortgage providers – Northern Rock – as it became the first major financial institution […]

US Economy Headed for Recession as Housing Bubble Bursts

Posted by Dr. Kurt Richebacher on Sep 14th, 2007 “America’s income-short, consumer-led recovery is the aberration – not the norm – in this Brave New World. It is all about ever-declining saving rates, ever-widening current account deficits, mounting debt burdens and increasingly wealth-dependent consumers. It personifies what I believe is one of the most precarious […]

Graft inquiry condemns World Bank

The World Bank has not taken corruption seriously enough and has resisted the efforts of anti-graft investigators, an official inquiry has found. Paul Volcker, former head of the US Federal Reserve Bank, said his inquiry into the bank had revealed a “siege mentality” at the troubled institution. Read more

Petrol on rise as crude oil soars to a record

Motorists are being warned to expect further fuel price increases as oil prices hit a record high of $US80 ($NZ112) a barrel. The price of unleaded 91 has risen 10 cents to $1.64 during the past month. Diesel prices have also sky-rocketed, up 12.6 per cent to $1.19 a litre. A small car, such as […]

Recession Time! The Housing Bubble Bursts the Economy

By Dean Baker     t r u t h o u t | Perspective    Tuesday 11 September 2007     The downturn in jobs reported last month by the Labor Department provided evidence of an economic downturn that even the economy’s greatest cheerleaders could not ignore. Healthy economies do not shed jobs.     During the core periods of the upturns […]