Financial, Business, Personal Finance News

U.S. consumer confidence to a low of 30 in August

U.S. consumer sentiment fell in August to its lowest level in more than 30 years, amid fears for economic recovery and disillusionment over government policies.

Preliminary estimates of the survey Thomson Reuters / University of Michigan released Friday, the index fell to 54.9, the highest since May 1980, after 63.7 in July. Analysts on average expected 63.0.

After this publication, the major indices on Wall Street erased some of their gains and the Nasdaq fell even in the red, before resuming their advance.In Paris the CAC 40 also briefly reduced his earnings.

The high unemployment, stagnant wages and the interminable debate between Democrats and Republicans over raising the debt ceiling weighed on consumer sentiment, who were interviewed before the downgrade of sovereign states United by Standard & Poor's.

"In the history of this survey, we have never had so many consumers who spontaneously mentioned the negative role of government," said in a statement the director Richard Curtin of the investigation.

"It's more than just the recognition that traditional monetary and fiscal measures are exhausted in large part, it is the realization that the government was unable or unwilling to act to do so."

Bitterness and CONCERNS

The Obama administration is reaping the negative opinions of 61% of respondents, the worst score among all the previous presidents.Two thirds of respondents felt that the economy had deteriorated recently.

And 75% are expected in early August in difficult times for the economy, a ratio approaching the historic peak of pessimism hit 82% in 1980.

The component of current conditions index fell more sharply than expected to 69.3, its lowest level since November 2009, after 75.8 in July and while the market awaited 74.3.

The expectations fell to 45.7, also unheard of since May 1980 against 56.0 in July to 55.3 and consensus.

Inflation expectations one year were flat in August to 3.4% last month compared with July, as well as expectations to five years, to 2.9%.

"The surprise is the sharp decline" of consumer sentiment, said Stephen Stanley, Pierpont Securities.

"Some numbers are even lower than what was seen during the recession and financial crisis. The fall in expectations appears to be due to the bitterness of the people on the political situation and their concerns about the financial markets. "

However, this study concern was partly minimized markets after the release of a 0.5% increase in retail sales in July in the United States, or their biggest increase since March.

"The expenses of people do not always match their mood. I doubt that things are as bad as what is suggested by the index of consumer sentiment," said Stephen Stanley.

All you need to know about the crisis in the euro area

Why do countries in the euro area they not borrow directly from the ECB? Who pays to save Greece, Ireland, etc..? Which European countries are likely to see their score worse? The responses of the writing of L'Expansion. Com. The logo of the euro to the European Central Bank in Frankfurt.

We asked you to ask us any questions you may have about the debt crisis. Here are those for the euro area and the public debt in general and our responses.

Why European states can not they borrow from the ECB, rather than through private banks?

Historically, central banks have indeed been created to fund the States. But now, states are required to obtain financing from capital markets. It is officially recorded in France since 1973 and is primarily in the Treaty of Maastricht.This rule is justified by the idea, questionable, that would reach more markets to discipline the poor performers: if a state is too extravagant or too much debt, the markets by requiring the sanction of the highest interest rates. And Germany is the assurance that states will not abuse the printing press which could lead to hyperinflation.

Which countries of the European Union who are under the risk of their score to deteriorate?

Greece, first. The country is already one or two notches of default. The rating agencies have already announced that the Greek note will rise to D (default) upon entry into force of the new rescue plan, which provides for an exchange of maturity and interest rate debt of the country, either losses for investors. Spain and Italy next.Both countries are under pressure from financial markets for several weeks, they feared a contagion of debt. Weaknesses: low growth prospects, a fragile banking system and a high unemployment rate for Spain, a high level of debt and a structural lack of competitiveness in Italy. Spain has already seen its rating (AA) degraded twice since 2009. Rating of Italy (AA2) is itself placed on negative watch by Moody's since June. The United Kingdom then and maybe even France. The austerity policy implemented by the country London is currently protected from cyclones in the financial markets. But the negative impact of the austerity of the British growth worries. As for France, S & P said that his "AAA" was stable. The agency has even praised Paris for its fiscal policy.This does not preclude some analysts to express concern. Because France has the worst fiscal ratios of the European Group of triple A.

ECB eases Italy and Spain by buying their bonds. But with what money? Who pays?

Nobody pays. As the central bank creates money in the refinancing of commercial banks, it is also to buy the debt of distressed states. If one country fails, it passes in provisions for losses on its balance sheet. Except that the ECB reluctant to pursue such purchases, pushing the European financial stability to take over, as provided by the latest aid package to Greece. To do this, the EFSF will issue bonds on financial markets.If Greece fails on these loans, the countries involved in the EFSF will repay creditors and there will be much the taxpayers who pick up the bill.

And if the debt was owned not by markets but by citizens, such as in Japan?

This is one of the solutions proposed to reduce dependence on markets and to guard against the loss of confidence that may arise, for example, a deterioration in the sovereign rating of the country. On the left, is defended by such Montebourg Arnaud and Jean-Pierre Chevenement. Japan's debt, which exceeds 200% of GDP, is considered more stable because it is owned approximately 95% by domestic investors. The postal bank converts debt including the vast majority of deposits. Some believe that 17% of the French savings rate, one of the highest in the EU, would make this system possible.Strong supporter of the re-nationalization of the debt, the journalist Jean-Michel Quatrepoint Tribune suggests the issue of treasury bills perpetual, paid around 4.5%, part of which would be recovered by the levies and the remainder reinvested in the economy. Economist Jean-Pierre Petit, interviewed by Expansion. Com, think instead that "saving the French would not have sufficient absorption capacity": the end of 2010, 1149 billion were placed on life insurance and 199 billion of the savings books, when the government debt exceeds 1.6 trillion. "It would not change the nature of the problem, said he, too, since these borrowers French-insurance companies, institutional investors, etc .- have the same fear of repayment capacity that international investors."

The Chinese car manufacturer Geely plans to invest in Indonesia

Chinese Geely Automobile Holdings plans to invest two billion dollars (1.4 billion euros) in Indonesia to meet the high demand for vehicles in the country, a newspaper reported Wednesday.

Geely could make Indonesia its production base for exports to other countries in Southeast Asia, including Australia and New Zealand, we read in the newspaper Kontan, quoting the Director General of a subsidiary of Geely, Budi Pramono.

The Indonesian economic growth comes from increased spending of the middle class and the economy could grow 6.8% this year, according to the central bank.

Geely, which owns 14 dealerships in Indonesia, has a sales target of 2,450 vehicles this year.

The Chinese company plans to build a factory in Cikarang, near the capital Jakarta by 2014 to manufacture 30,000 cars a year, the newspaper said.

Geely bought Volvo from Ford in August 2010 for $ 1.8 billion (1.4 billion), concluding the largest takeover of a foreign automaker by a Chinese.

The Paris Bourse is close to its lowest in 2011

The Paris Stock Exchange declined sharply and approaches the lowest of the year in early trade Friday after four consecutive sessions of decline against a background of political stalemate in the United States on the ceiling of debt and doubt resolution the debt crisis in the eurozone.

Around 9:30, the CAC 40 index lost 1.02% to 3674.92 points after a low of 3649.96 points, or five dots above the lower end of the year reached on July 18th (3645 points) .

The results of large groups is not likely to improve the climate created by the sovereign debt crises in Europe and the United States, investors punish poor performers.

Veolia (-6.58%) shows the largest drop in the CAC 40 after being forced to lower its 2011 targets.

Schneider fall of 4.3%, Japan and commodity prices have had a negative impact on the first half.

Vallourec gained 1.76% and is the subject of buying on the cheap after a fall of almost 17% following the announcement of a drop in its second quarter results.

London and Frankfurt lost 0.46% 0.81%. Of the European indices, the EuroStoxx 50 yields 1.07% and 0.69% Eurofirst 300.

The euro declined and traded around 1.4290 dollars against 1.4330 on Thursday.

COR-Deutsche Bank earnings below expectations

Deutsche Bank reported Tuesday a quarterly profit before tax lower than expected, following the presentation of its new management team.

Germany's biggest bank posted a profit before tax up 17% in the second quarter to 1.8 billion euros, while analysts polled by Reuters were expecting $ 1.97 billion.

Its net profit came out unchanged at 1.2 billion euros.

The bank expects to achieve its goal of a 2011 profit before tax of EUR 10 billion, but that it could miss its target on its corporate finance, due to the debt crisis in Europe.

Deutsche Bank announced Monday that a duo of Anshu Jain and Jürgen Fitschen be succeeded in May 2012 at the CEO, Josef Ackermann.

Anshu Jain, 48, heads the investment bank Deutsche Bank while Jürgen Fitschen, 62, driver's German operations of the facility.

U.S. debt: the Senate is working on a "plan B"

To avoid a failure to pay the United States, U.S. senators plan to allow President Obama to decide one of raising the debt ceiling to 2.5 trillion dollars in three installments. Capitol

Trench warfare on raising the U.S. debt ceiling continues this week in Congress, where elected officials are working on a "plan B" to bypass the blockage and prevent a failure to pay the United States after August 2.

The political impasse remained Monday despite warnings last week of rating agencies, pressure from China, warning the administration against an Apocalypse if unpaid bills by the federal government. Monday morning, U.S. treasury secretary, Timothy Geithner, has nevertheless ensured that an agreement would be signed."Nobody is going to play stupid on this issue," he said on CNBC, saying again that default would be "catastrophic" for the country.

In the Senate, Majority Leader Democrat Harry Reid, took the issue seriously Monday by declaring that the upper house would remain in session "every day, including Saturdays and Sundays until (…) Congress passes a bill that prevents the United States to shirk its obligations. "

Faced with deadlock, Mr. Reid and his fellow Republican Mitch McConnell of attempting an operation last chance to reach a formula acceptable to both sides. This "plan B" would give the president the power to rise three times the maximum debt of 2,500 billion dollars by next year.But it would leave only the responsibility-and risk-policy of raising the debt ceiling.

The Senate plan could also include spending cuts of up to 1,500 billion over 10 years, measures on which both sides agree. The ultra-conservative movement of the "tea party" very influential in the House, however, condemned the plan of withdrawal.

For its part, the spokesman for the White House, Jay Carney, assured that the president continued to "call the broadest possible agreement". But according to Carney, the president wants to ensure that there is "a backup plan" such as that of Senator McConnell, even if this plan is not his preference. This could be examined by the middle of the week.

But before that, Tuesday, the House of Representatives will vote on the latest proposal of the Republicans, entitled "Reduce, cap, balance."The symbolic text, which should be rejected by the Senate to Democratic majority, would require such an amendment to the Constitution to the federal budget is in balance, as well as strong cuts.

The inevitable failure of this plan will only emphasize the gap between Democrats, who demand a policy of deficit reduction focus on more tax revenue, and the Republicans, who do not want to hear about tax increases but only draconian budget cuts. The White House pressed the point home Monday warning that Obama would veto the text, in the highly unlikely event that the Senate would approve.

Republican John Boehner said he was "disappointed" in a statement Monday about the threat of the president, accusing the White House to lack "serious" and to avoid difficult decisions."We're making progress," but Obama said Monday during a brief interview with the press.

CBS News poll released Monday, 71% of Americans disapprove of the way Republicans in Congress led the negotiations. Democrats register them a negative score of 58%. Since mid-May, the U.S. federal debt, to 14.294 billion dollars, has reached the maximum allowed, an issue that the Treasury is unable to circumvent that through hocus-pocus of short duration.

Carrefour sees his ambitions evaporate Brazilian

The abandonment of Abilio Diniz proposed merger between the Brazilian subsidiary of Carrefour and distributor Grupo Pao de Acucar (GPA) is another setback for the giant French distributor who struggle to adjust its performance in mature markets in Europe .

The withdrawal of the state bank BNDES, supposed to finance in part the operation, coupled with the overwhelming opposition expressed Tuesday by the Board of Directors of Casino, were due to the commitment shown so far by the President of GPA, the Billionaire Abilio Diniz.

In an abrupt about-face, the businessman said last night that the project was "suspended", ending the hopes of Crossroads to increase its exposure in a strategic market with strong growth.

The second is a worldwide distributor delicate position. Already weakened by three successive warnings about its results since last fall, he announced Wednesday that operating profit would fall 23% in the first half because of its poor performance in France.

He has not given much to its annual targets as all the analysts said, however, out of reach.

CASINO HAS PLAYED ON ALL TABLES

"The Brazilian deal is dead.This is a new blow to the strategy and management of Carrefour, "said one analyst who requested anonymity.

The French giant has in his strayed into a complicated issue and the outcome of which was the least risky in light of existing commitments towards Casino.

To Herve Mangin, fund manager at Axa IM, the market fears that Brazil joins the series of false hopes given by the group in recent years.

In exchange, according to new lows hit in the opening, the title has recovered and showed an increase of 0.8% to 22.17 euros to 14.15, in a stable market.

At these courses, it shows a fall of more than 28% since the beginning of the year.

"We arrive at a true value to the case.Investors buy at that price, but the question of management or strategy, "said one trader.

Casino, for which the market had already largely mediated Tuesday, took for its 2.13% to 64.84 euros, limiting its loss to 11% since January.

"The overwhelming opposition of the board of Casino was the main factor that determined Diniz to back down," said a close case. For the Brazilian, this operation was inconceivable without the group Saint Etienne, they added.

It is true that in the battle, Casino has been sustained.First attacking Abilio Diniz before an arbitral tribunal, then proceed to an intense lobbying Brazilian authorities by speaking of "expropriation" and finally engaged, through a board of directors unanimously (with the exception of the voice of Abilio Diniz) in an attack in good standing of all the economic aspects of the project.

A FACE-TO-FACE FINE

While Carrefour has submitted its agreement to the green light from the BNDES, the French group could only take note Wednesday morning that "the conditions of a merger are not met."

However, its chief financial officer said Wednesday during a conference call that if a new offer was presented, Carrefour could study it.

Seeing as the days wane the public support of his country, Abilio Diniz had assured the opportunity to find other ways of funding than the BNDES.

But in the present circumstances, it is unclear how it could come back to Carrefour with a proposal that would still not the business of its French rival.

In the short term, the question arises of face-to-face between hard Abilio Diniz and Jean-Charles Naouri and governance of a group (GPA) that they co-control through its entire holding Wilkes.

Some observers suggest a possible release of Abilio Diniz before the expiry of a pact that binds to the Casino.

"Today, Casino has clearly scored points.The pact with Diniz seems flawless, Casino has the right for him, a factor that has gradually been built by the Brazilian political circles, "said one investor.

Ally historic Casino in Brazil, Abilio Diniz was proposed late June to Carrefour, in a complex pattern, to merge its Brazilian operations with those of GPA to give birth to an industry heavyweight weighing more than 30 billion euros in turnover business.

This scheme quickly approved by the board of Carrefour, had immediately provoked the wrath of Casino, under a shareholders' agreement signed with Abilio Diniz ten years ago, can take control of GPA as of June 2012.

The debt crisis is spreading dangerously in Europe

The reluctance of Europeans to the establishment of a second aid package to Greece concern the markets. The financial turmoil won Italy and Spain. The logo of the euro to the European Central Bank in Frankfurt.

Several countries expressed concern Monday, July 11 the risk of the whole euro area gained by the turbulence caused by the debt crisis in the markets, while Italy pitching turn and called for swift action to stabilize the situation. "We have seen tensions in financial markets in different countries (euro area), maybe a little more in Italy than elsewhere, but we are witnessing the tensions across the euro area and so we have find a solution, "said Belgian Finance Minister Didier Reynders, before a meeting with his counterparts of the monetary union in Brussels.

The banking sector has been particularly rough ride Monday on European financial markets, fears of a default of Greece and the risk of contagion to Italy feeding the fears of investors. Anxiety was setting across Europe with an index Stoxx European banking fell by 2.49%. Italian banks were the most affected. The Milan Stock Exchange let go of 4.3%, as the Lisbon Stock Exchange. The Madrid Stock Exchange it was down 3% Monday afternoon.

"We are faced with something that is more systemic" that the only case of Greece and "the stability of the euro area as a whole", he echoed the Spanish Finance Minister, Elena Salgado. His Greek counterpart Evangelos Venizelos has also called on Europeans to end their procrastination on how to deal with a crisis that has lasted over a year and a half."Today we need a strong and clear message in favor of stability, not only in Greece but in the euro area," he said.

The reluctance of Europeans focus on the development of a second aid package promised to Greece, on a scale similar to the first 110 billion euros in loans decided a year ago. They come from differences over the need to help this time the country's private creditors, banks, insurance companies and pension funds, and the modalities of such participation. "We must now find the guidelines for private sector involvement," stressed Mr. Reynders. Germany, the Netherlands and Finland in particular are a requirement to unlock new loans. "A substantial private sector participation is a pre-condition", reiterated Monday the Dutch Minister of Finance Jan Kees de Jager.

Other countries and the Commission and the European Central Bank (ECB) are much more reserved because they fear that fueling the nervousness of the markets and do not feed a contagion to other fragile states. Madrid is one of reluctance. "Spain has always been cautious about this because it may cause instability. Since the beginning we fear that generates instability," said the Minister of Finance. In any event, the Belgian minister has insisted he does not force you to hand to the banks. "I am sure we will come to an agreement today on a voluntary basis" for this contribution, Mr. Reynders said, calling for a French proposal to "rollover" of the bonds: the banks would be invited to renew their loans to Greece where they have already made them mature.

However, this option has the lead in the wing since the rating agency Standard and Poor's warned it would cause a default part of Greece, that Europe wants to avoid. So, even if it does not receive the approval of rating agencies and have a default, the Netherlands and other countries favor to present to a more radical option. "We did not say that this should be mandatory (…) but some rating agencies will consider any substantial interest as not entirely voluntary," said the Dutch Minister.

France wants to regulate rating agencies

France wanted Wednesday continued effort to regulate rating agencies, whose intervention in Greece, Portugal and Ireland are strongly criticized by the European Union.

"France considers that the effort to regulate rating agencies, which started in 2008, must continue and this is the direction we are going to work," said the spokesman for the French government, Valérie Pécresse.

The European Commission Wednesday sharply criticized the decision by Moody's placed the debt in the speculative grade Portuguese and warned it would take action against the rating agencies.

The Commission President, José Manuel Barroso, accused Moody's, Standard & Poor's and Fitch to encourage speculation in the euro area.

During the proceedings of the French Council of Ministers, Valérie Pécresse, who is also Minister of Budget, indirectly criticized Moody's, without mentioning his name.

"The Portuguese government has taken very bold relief," she said. "It is especially important to let the Portugal work and not hasty judgments about the Portuguese situation that could compromise the recovery plan."

Asked about the ongoing discussions on private sector participation in the financial rescue plan for Greece, Valérie Pécresse stuck to generalities, and refused to comment on the plans currently on the table.

"This participation must not cause any default or credit event and must take the form of a rollover on exhibitions," she said."In this context we are working with our partners."

"There is a French proposal, there is a German proposal. We work together on these proposals," said Valerie Pécresse.

Wall Street achieves its best week in two years

U.S. stock indexes began the month of July ended with a bang in Friday's session on strong increases, reaching unprecedented weekly performance since July 2009.

The Dow Jones closed up 1.36% or 168.43 points to 12,582.77, while the S & P 500 rose 1.44% or 19.03 points at 1339.67.

The Nasdaq meanwhile gained 1.53% (42.51 points) to 2816.03.

After one week during which each session ended up, the three indices gained 5.4%, respectively, 5.6% and 6.2%.

In addition to signs of healing on the Greek debt crisis, which supported all of the week, Friday's session took advantage of good numbers of manufacturing production, to reassure the state of the U.S. economy.

The ISM manufacturing index in June stood at 55.3 after 53.5 in May. The rebound in the first four months left to hope that the recent slowdown in U.S. growth is only temporary.

Ford and General Motors, which announced sales up though below expectations for the month of June, saw their shares rose by 1.67% and 0.72%.