Financial, Business, Personal Finance News

European markets down slightly, investors cautious

Investors continue to play it safe Friday in anticipation of monthly U.S. employment. The European stock markets opened slightly down in the wake of the fence undecided on Wall Street, the CAC 40, FTSE 100 and the DAX lost between 0, 1% and 0.3%.

The Tokyo Stock Exchange ended down after three sessions of consecutive increases.

In the Greek case, the European Central Bank (ECB) is studying how to contribute to the bailout of Greece in Athens and could make profits earned on Greek bonds it holds, by circumventing the prohibition of direct financing of the States.

Values, Volvo earns 1.8%. The Swedish manufacturer of heavy trucks has yet reported an operating profit below expectations for the fourth quarter of 2011.

LVMH lost 1.5%, a victim of profit taking after the publication of its 2011 results.

An agreement on Greek debt may be Wednesday

The negotiations between Greece and its private creditors on debt restructuring of the country could be concluded on Wednesday, said bankers and politicians, even if a rise in the role of the European Central Bank (ECB) is now seen as imperative in the case. </ p> According to the bankers and those responsible for the sector Private is now ready to accept a discount of about 70% of Greek government bonds held by it, which should reduce the debt of some of Greece 100 billion euros. </ p> The Greek Finance Minister Evangelos Venizelos for his part said that the discount could be even higher than 70%.</ P> That said, despite its size, this discount should not, according to officials, be sufficient to reduce the debt of Greece E equivalent of 120% of gross domestic product (GDP) by 2020, ratio deemed necessary, as part of plan to help the International Monetary Fund (IMF) and the European Union to make debt sustainable. </ p> As a result, more and more people involved in the case believe that the Greek public holders of securities – the ECB and national central banks of euro area – must participate in the debt restructuring of the country, continued bankers and officials.</ P> "The analysis is done at this stage is to see what measures the public sector could take to reduce the debt of Greece," he told Reuters a European Head , to the point of discussion. </ p> "The goal is to reduce the debt-GDP ratio to 120%, but even with the exchange of debt, it is still be ; s so far the public sector involvement is necessary. "</ p> A banking source said it was now accepted that private sector involvement would not produce the desired effects without the public sector also assumes some of the losses. </ p> "Now we discuss how," she added.</ P> LOSS FOR CENTRAL BANKS </ p> sources of the ECB told Reuters last week that the ECB had paid during the year e past, as part of its controversial program to buy back shares, 38 billion to buy Greek bonds with face value of 50 billion euros. </ p> The ECB finds itself position to record a nominal gain of 12 billion euros, a sum that could be reassigned to Athens without the ECB does not suffer losses. </ p> But one European official added that this still not enough to bridge the gap – estimated at 10 percentage points – between the discount that is about to make the private sector and the goal of a debt of 120%.</ P> The ECB and national central banks in the euro area could be forced to take losses on assets held or at least to waive payment of interest. </ p> But, according to sources, the results of some national central banks would not withstand such losses. </ p> "This complicates the discussion," said a banker about this possibility. </ p> Another source said that it might be necessary for one or more central banks to raise capital to offset possible a loss.</ P> While discussions on private sector involvement culmination Wednesday – after I started there almost seven months and have been interrupted several times – the resolution of the issue of public sector involvement could still take a few days. </ p> European shares closed higher, buoyed by the hope biento t reach an agreement between Athens and its private creditors on Greek debt and after the adoption of the new Treaty of fiscal discipline. </ p> Failing agreement, the Greece could end up in default of payment, when 14.5 billion euros of bonds will mature in March. </ p>

The Italian Senate on Friday approved the law of financial stability, a set of austerity measures demanded by the European Union to deal with the debt crisis in the euro area.

The Chamber of Deputies will vote Saturday on the text and Prime Minister Silvio Berlusconi, private on Tuesday its majority in the House, has promised to resign in the wake to give way to a broad-based government should be led by the former European Commissioner Mario Monti.

The latter voted for the first time Saturday at the Palace Madame – he was appointed senator for life last Wednesday by President of the Republic Giorgio Napolitano.He also called Italian President to express his confidence in his "leadership".

Nicolas Sarkozy announced that he would speak in the day Friday with Giorgio Napolitano.

A MONTI market confidence

"What is needed is that we could get back on track in Greece, it is happening, our Italian friends, who so many ties bind us is what is being to be. I will immediately President Napolitano on the phone, "he said on the sidelines of celebrations of the Armistice of November 11,.

The U.S. Treasury Secretary Timothy Geithner stressed that the crisis in Europe was "the main challenge to global growth."

Outgoing Prime Minister and opposition leader have agreed on the names of the ministers of the next coalition government. They should announce it in the day. President Papoulias with George Papandreou and Antonis Samaras.

Greek Prime Minister outgoing, George Papandreou and his conservative rival, Antonis Samaras agreed to form and announce "that day" the new coalition government that they negotiate for three days, told AFP a government source . "There is an agreement on the course, which provides that Mr. Papandreou will make by the beginning of the afternoon at the head of state, who then convene a meeting of leaders of political parties during which agreement will be recognized and announced the composition of the new government, "the source said, but to come forward on behalf of the future prime minister, whose only certainty is that this is not Mr.Papandreou.

An ad for a room of 4.5 m² sold 38,000 euros has rekindled the controversy over the excesses of the real estate in Paris. Should we see evidence of a "market shacks" and the activity of the slumlords? Elements of response. http://www.flickr.com/photos/gcattiaux/

"Avenue Théophile Gautier, the seventh with no elevator. Refurbished room with skylights, approximately 4.5 m2 floor, WC on landing. Ideal office or residence. Price: 38,000 euros … Or nearly 8500 euros per m2. " Wednesday blamed the Liberation journalist Tonino Serafini, this ad has revived the controversy over the excesses of the housing market in Paris.

"Prices are high in Paris in general. They can go up to 12,000 euros per m²" says Jean-Yves Mano, the deputy mayor of Paris in charge of housing. Theophile Gautier Avenue, the average price rises in 9200 and euros, or 700 more than the closet in question.According to the election, "it's the size that is unreasonable. This announcement is outrageous and I hope no one will respond favorably" says he. The site pap.fr, who had published, was also quick to remove it.

But it is far from an isolated supply. "Further announcements show that there is a market shacks" said Libération journalist also on his blog. It evokes a room as well rue du Faubourg Saint-Denis (Paris IX) of 6 m2, or another in the 17th, 7 m2, both at 45,000 euros. But who are the real buyers in this market? What is their purpose?

Merchants of sleep?

The law prohibits a surface lease under 9 m², considered minimum level of decency. "But I do not see anyone buying a small area at this price if not for the purpose of return" admits Jean-Yves Mano.

The trade deficit is reduced by Airbus

The French trade deficit narrowed to less than 5 billion euros in August, against more than 6 billion in July. But he reached the summits Enco: January 1, the accumulated balance in the trade balance was -48.5 miliard. Assembly plant of Airbus A380 in Toulouse

The trade deficit of France was a switchblade in August. It fell to 4.97 billion euros, 6.36 billion after July when adjusted for seasonal variations. The decrease was due to a sharp rise in exports of transport equipment, Customs said Friday.

"In August, the implementation of major aerospace contracts causes a sharp increase in exports of transport equipment. In addition, industrial supplies remain firm.In the end, the deficit is entirely due to the transport sector ", have they said in a statement.

The accumulated balance in the trade balance since 1 January but still reached record highs. He came to indeed -48.560 billion euros, against -33.184 billion in the first eight months of last year. And over the last twelve months, the gap between imports and exports widened to 66.8 billion euros, against 51.5 billion for 2010. Exports reached on August 37.42 billion euros, up 2.9% at three months. Imports have risen to 42.387 billion euros from 41.628 billion in July.

In August, France sold its 16 Airbus reported 1.345 million euros against 20 in July to 1.183 million.In addition, France has delivered two satellites, one in China (112 million) and the other in the United States (130 million). The performance of aerospace and aeronautics, powered shots of large contracts, are very volatile from one month to another.

Moody's lowers rating to three notches Italy

Moody's Investors Service downgraded Tuesday by three notches note of Italy, explaining see an increase risk of financing for euro area countries with high levels of debt.

Moody's reduced the rating of Italian government bonds from Aa2 to A2, a grade lower than that of Estonia.The U.S. agency maintains a negative outlook on this rating, which means that further falls will be a few years.

On 19 September, Standard and Poor's had lowered its rating on Italy as it was previously A/A-1 to A + / A-1 +.

Italy now finds itself firmly at the center of the crisis of debt in the euro area.

"The negative outlook reflects the economic and financial risks in Italy and in the euro area," Moody's said in a statement.

"The uncertain environment of markets and the risk of further deterioration in investor sentiment could limit the country's access to public debt markets."

Financial markets are worried more and more weak growth, a deficit of 120% of gross domestic product and a coalition government in difficulties.

The decision by Moody's is not really a surprise. The agency had said Sept. 17 it would complete its review of Italian finances for a possible downgrade within a month.

Silvio Berlusconi said that the decision was "expected".

"The Italian government is working with maximum commitment to achieve its fiscal objectives," said the head of government.

Moody's believes, however, a defect of Italy is a probability "distant".

Borrowing costs have surged in Italy the past three months.And if they were brought under control, thanks to purchases of Italian bonds on secondary markets by the European Central Bank.

So last month, an Italian ten-year loan had to be based on the promise of a return of 5.86%, the highest level of this type of paper since the launch of the euro there over ten years.

The austerity plan of 60 billion euros from the Italian government to enable it to accelerate by one year to 2013 its goal of a balanced budget.

Dexia would be willing to sell 20 billion euros of assets

Dexia Bank is ready to sell 20 billion euros of assets to restore its finances, Les Echos wrote in their Monday edition.

"The Franco-Belgian bank crystallizes the difficulties of his peers: its viability through the sale of assets too fast cash customers for nearly 20 billion euros," reads one in the business daily.

"Another lever is to externalize 80 billion of loans to local governments, but the modalities of this operation are still in limbo," the newspaper without elaborating.

A Dexia spokesman was unavailable for immediate comment this article.

Le Figaro wrote Saturday that Dexia, Caisse des Depots and Post Bank negotiated the creation of a new public to fund local government, an operation that would allow Dexia to reduce its balance sheet.

Requested by Reuters on Friday night, the three banks did not comment.

The governor of the Banque de France, Christian Noyer, said about Dexia that "the model faces a number of problems," in an interview with Journal du Dimanche.

"It must continue to restructure," he says.

The French authorities said Sunday that the system created in 2008 to help banks following the collapse of Lehman Brothers was always available on event "extraordinary".

However, they insisted that French banks, whose market value has shrunk in a few weeks, were strong and they did not need injections of public capital demanded by some stakeholders in the financial markets.

Besson rejects the hypothesis of nationalization of banks

The French Minister of Industry, Eric Besson, ruled Monday "totally premature" to discuss the hypothesis of a partial nationalization of French banks to prevent serious impacts of the debt crisis.

The major French banks have suffered heavily traded in recent weeks of market turbulence, to the point that some observers do not exclude more than they must use the financial support of the state to strengthen their capital base.

"It seems premature and totally beside the point now to raise this event," said Eric Besson on RMC and BFM TV.

Societe Generale announced earlier today a new savings plan, while the rating agency Moody's might, according to several sources, the note will soon deteriorate and those of BNP Paribas and Credit Agricole.

How to reduce unemployment without growth

For the French economy creates jobs, it must grow by at least 2%. Unattainable at present. However, there are solutions to reduce unemployment. Here's why. Agency employment center in Nice

After four months of slight decline earlier this year, unemployment in France has increased considerably and the. In July, the number of unemployed rose by 36,100. It is the largest monthly increase since October 2009. It is particularly disturbing that this is the third consecutive month of increases. "Predictably, with growth at 0%," Xavier Bertrand has responded in an interview with Le Figaro on Friday. "But that does not detract from my belief that unemployment will go back down," he added.

It appears optimistic, our Minister of Labour. As rising unemployment reflects a depressed economic conditions.As recalled by Xavier Bertrand growth lights made the place the second quarter. And the second half does not look better, the two engines of growth – business investment and household consumption – being seized. The government also revised down its growth forecasts for 2011 and 2012 – to 1.75% against 2.25% and 2 before. Some analysts are even more pessimistic: they expect a growth of only 1.5% this year and 1% next year.

Or to create jobs, the French economy should grow by at least 1.5%. And to reduce unemployment is to say, create enough jobs to absorb the growth of the labor force, growth must be at least 1.8%. And that's in normal times. The problem is that the French economy out of two years of zero productivity and a year of recession – in 2009.The catch must be more important. To reduce unemployment, it would now grow by at least 2.3% per year. We are far. "In order to reduce unemployment without growth, there are only two treatments, said Eric Heyer, deputy director of analysis and forecasting department of the French Office of Economic conjectures (OFCE).

Administrative treatment of unemployment

France has the chance – or luck – to have a dynamic workforce, due to a high birth rate (more than two children per woman). According to INSEE, the labor force, which stood at 28.35 million people in 2010, is expected to grow by an average of 110,000 people a year by 2025. More than 9000 people a month who register for employment center. To reduce the workforce, just out lists of people registered as unemployed.How? "In the radiant, by offering internships, apprenticeships and training, or putting them into early retirement and by providing job search," Eric Heyer lists.

Radiation administrative job seekers jumped unusual in July (25.1% over the month and 7% year on year). The SNU FSU, the majority union at employment center, sees the consequence of the recent computerization of letters sent to the unemployed. Some economists also point out that past governments in pre-election period, have used an administrative treatment of unemployment.

The current government is not immune to this temptation. Last February, Nicolas Sarkozy announced the release of 500 million euros to encourage the use of long-term unemployed and young people. On the menu: skills training and learning.Or people in learning or training out of lists of employment center. However, the government has no intention of using the subterfuge of early retirement, on the contrary, the exemption from job search (DRE), which allows the unemployed aged 60 and over not to look employment and reach retirement, will be removed in 2012. As for the pension reform passed in 2010, it extends the legal age of retirement and the age of full retirement. Which penalizes the elderly first. Since January 2008, unemployment of over 50 jumped 57%.

Social treatment of unemployment

"The alternative to reduce unemployment when growth is not the appointment is that the public sector taking the baton in the market sector," said Eric Heyer. This includes all forms of assisted contracts, that is to say, employment contracts mainly funded by the state.This is called the social treatment of unemployment. It is a great classic from the left. Martine Aubry, the Socialist candidate in the primary, has already announced that its first action as president, if elected in 2012, will be to remove the tax exemption of overtime to fund the creation of 300,000 "jobs of the future "- the little brothers of youth employment in 1997.

But this solution is also widely used on the right. The government is not talking about jobs for young people but CAE (support contracts in employment in the public sector) and ICE (employment initiative contracts in the private sector). 440 000 of these subsidized contracts to be financed by the state this year.

"While it is not sustainable contracts is not a panacea, recognizes Eric Heyer.But these subsidized contracts have two advantages: one is to target audiences that have the most difficulty in finding employment [the young and long-term unemployed for example], the second is to provide purchasing power to more, which is likely to boost consumption so the country's economic machine. "