Financial, Business, Personal Finance News

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."

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.

Professionals solar electricity on Thursday presented their general condition. They believe France is capable of producing 20 gigawatts by the age of 10, which would allow it to interfere in an expanding global market.

Do not waste the potential of the photovoltaic sector. That's essentially the message that wanted to pass Thursday industry professionals gathered as part of the presentation of their general condition. According to them, photovoltaics can create 100,000 jobs by 2020. They argue that the solar electricity market is exploding worldwide, and that within 10 years will weigh between 79 and 129 billion euros a year in revenue. They believe this type of energy could begin to be as efficient as electricity from the grid by 2016.It provides for a reduction in production costs by 50% by 2020, following the industrialization of the sector. And a boom in sales following a European directive which induces that all new homes to be energy self-sufficient over a year since 2020.

The professionals ensure that France has the means to take advantage of this expansion. To do this, it must be able to install a power production of 20 gigawatts (GW), which happens according to professionals with an investment of 800 million euros per year and the establishment of a "regulatory framework visible and stable. " "Instead of the objective of the Grenelle 5.4 GW in 2020, we offer 20 GW, which will create 100,000 jobs of which 12,000 can not be relocated in the industry," said Loïc de Poix, responsible of the Association of French industrial PV.

After several months of the States General, all industry players have submitted their proposals to the press for the future of a sector that has suffered greatly from the moratorium imposed in 2010 by the government, which resulted in the removal some 10,000 jobs. These proposals focus on four areas: defining a stable regulatory framework with measures to support demand and supply meet the production target to 20 GW by 2020 against 5.4 GW currently adapting the rates redemption of the solar electricity and regionalization. If nothing is done, the sector could be a deficit and a half billion euros in 2020.

Sanofi, the reconstruction of the research will be long

Sanofi is expanding its portfolio of medicines to be able to rise to valuation levels comparable to its peers, but it will take time, analysts say.

The French laboratory, shaken by the lapels of the anti-arrhythmic Multaq Iniparib and cancer, has made the past five years only two new products on the market (and Multaq Jevtana in prostate cancer). It plans to launch 19 drugs by 2015, six next year, but warns that it expects no more than 5% to 7% contribution to sales in this horizon.

Of "minibusters", ironically some analysts, however, willing to give time to a group that has appointed the head of its research Elias Zerhouni, a world-renowned scientist.Since that appointment, the European regulator, however, restricts the use of Multaq, and Iniparib proved a failure in the last phase of its development.

"Sanofi has made significant progress in improving the profitability of its research but we know the results in eight or nine years. We have to accept a long development cycle", says Michael Leacock, an analyst at RBS.

The group announced this year more positive Phase III, and for including Lemtrada Aubagio (multiple sclerosis), Zaltrap (colorectal cancer), Visamerin / Mulsevo (prevention of venous thrombosis) and Lyxumia (type II diabetes).It is the latter that analysts consider the most promising, with potential sales they estimate at about 600 dollars in 10 years.

DIFFICULT TRANSITION TO MANAGE

"This is a cohort of small to medium products that will not be enough to transform the group, but at least it has more risk (of the type of anti-obesity pills) Acomplia when suddenly a product may weigh 15% to 20% of sales and cause large deviation in the share price, "an expert in the field into perspective.

Three years after the failure of Acomplia and the arrival of CEO Chris Viehbacher, Sanofi has launched a strategy to find new sources of growth that does not depend on its research and especially not the 'blockbusters', these drugs can make more than one billion dollars in sales.

Spurred by the loss of its major patents, the group has drastically reduced its costs, carried out an extensive cleaning of its project portfolio and achieved a score of acquisitions exceeding 23 billion euros, 14.8 billion for the purchase of the U.S. biotech Genzyme.

These efforts now allow to predict an average growth in sales of at least 5% by 2015 and an increase in earnings per share higher than the turnover.

At Bryan Garnier, Eric Le Berrigaud believes that the next six launches of the group potential "of around four billion euros in full peak at the end of the decade, with an additional lever on Lemtrada if it turns out be sure. "

"Are we willing to pay 'upfront' history to be born again Sanofi in 2013, while it was still difficult to cross two years?" Asked he, however.

The title Sanofi, which has lost 13% in 2010, returned 3.5% since the beginning of the year.The stock is trading with an average ratio of price / earnings ratio (PER) expected to close in September, against nine for the European.

"There is a beautiful story of stock market recovery to play but it will not materialize quickly. The big challenge is to manage the transition between the death of the great product, the rise of products from the pipeline and related growth drivers strategy, such as diversification and emerging markets, "said one banking analyst.

Karl Heinz Koch, of Helvea, notes that "most of their products are secondary and are not first class."For him, the portfolios of Novartis and Bayer are better than Sanofi, which is comparable to those of Roche and GlaxoSmithKline, and similar but better than Merck and AstraZeneca.

Beatrice Muzard, Natixis, concedes that "Sanofi back a little better in terms of development," but believes that the group "is still far short of the very good students like Roche, Novartis and Glaxo same."

"It's not for the pipeline that we recommend buying the title," she adds. "What motivates us is the visibility of growth and the fact that the group has secured a growth of at least 5%, a level that exceeds 60% as revenue grew at double-digit ".

Soon Eurobond for good students?

Vice-President of the European Commission, Viviane Reding, proposes to create obligations for the European countries most solid. She wants to be a "rock in the middle of the storm." European Commissioner for Justice, Viviane Reding, called "irresponsible" attitude of France and Germany on the reform of the Stability Pact (here at a conference in Brussels REPSSI September 29, 2010)

The European Commission has raised the possibility Friday of Eurobonds restricted to six countries in the euro area receiving the highest rating by the agencies, among the options being considered to better face the future with debt crises excessive. This idea is supported personally by one of the vice-presidents of the EU executive, the Luxembourg Viviane Reding.

"The United States are in a difficult situation but have no problem with the bond market because it is so great" at home, argued Commissioner Reding, responsible for justice issues, in an interview published Friday by the German daily Hannoversche Allgemeine Zeitung. "This is why I propose that all states in the euro area receiving the highest rating, AAA-rated states – France, Germany, Luxembourg, Austria, Netherlands and Finland – are pooling their bond markets "she said.

Such a mechanism for sharing national public debt of the most solid would be "a rock in the middle of the storm," she said.The spokesman of the Commission, Pia Ahrenkilde, said in Brussels that this idea was part of various options under consideration within the EU executive, which plans soon to submit a feasibility report on Eurobonds with the various possible formulas.

"There are a number of options are discussed, the remarks of the Vice-President (Viviane Reding) must be seen in this context," she told reporters. The creation of such a pot of government borrowing by countries in the monetary union is seen by its promoters as the only lasting solution to the debt crisis by ensuring that fragile states are protected by the strongest . However, Germany refuses because she sees an incentive to fiscal laxity. Its Ministry of Finance rejected this mechanism again Friday, although limited to countries rated triple "A"."Our position has not changed" and "this is true whatever the composition of the group (country) which would be backed Eurobonds," said a spokesman for the Ministry in Berlin.

Moody's downgrades notes by one notch to SocGen, Credit Agricole

Moody's Investors Service on Wednesday downgraded by one notch the notes of Credit Agricole and Societe Generale, citing their exposure to the Greek economy.

Moody's lowered the rating one notch to the long-term debt and deposits of Societe generale de Aa2 to Aa3 with a negative outlook. Moody's believes that the impact of supervision on the Bank Financial Strength Rating (BFSR) will be limited to one notch.

For Credit Agricole, Moody's downgraded the BFSR a notch, from C + to C, and brought the note from the long-term debt and deposits one notch, to Aa2 from Aa1.

About BNP Paribas, the agency kept under review with negative implications the long-term rating Aa2 and deposits, and the note of B-BFSR.She believes it is unlikely that this under surveillance results in a downgrade of more than one notch.

Washington continues 17 banks due to subprime

The U.S. federal agency oversight of mortgage filed a complaint Friday against 17 major international financial institutions for a total loss of $ 41 billion in bonds linked to subprime.

The Federal Housing Finance (Federal Housing Finance Agency), which oversees the giants Fannie Mae and Freddie Mac, criticized those institutions which include Bank of America, JP Morgan Chase, Goldman Sachs, Deutsche Bank or Societe Generale, have sold bonds backed by home loans in these transactions by presenting inaccurate one day.

The director of the FHFA, Edward DeMarco, seeks to minimize the losses of Fannie Mae and Freddie Mac, which had to be nationalized under cover of the 2008 crisis.Fannie and Freddie guarantee bonds backed by home loans.

The banks ended sharply lower on Wall Street. Bank of America lost 8.34% to 7.25 dollars, JP Morgan Chase 4.6% to 34.63 dollars and Goldman Sachs 4.55% to 107.06 dollars.The KBW index of banking sector has lost 4.5%.

The FHFA and other investors say the banks in securitizing mortgages granted to individuals for the purpose of selling them to investors, have not made all the necessary checks and concealed, or not presented correctly, the quality the underlying loans and the borrowers' ability to pay.

Gradually, as borrowers can not meet their deadlines have become more numerous, the value of securities backed by loans dropped, resulting in losses for investors.

The FHFA JP Morgan continues to securities losses totaling more than $ 33 billion.The complaint against Société Générale is more modest: about $ 1.3 billion.

In his complaint against Merrill Lynch, the FHFA says: "The defendant falsely stated that the underlying mortgage loans meet certain guarantees or guidelines, including presentations that have significantly exaggerated the ability of borrowers to repay their mortgage (…)".

FACTORS OF CONCERN

The federal agency in housing finance has already filed a complaint against UBS in July, seeking to recover at least $ 900 million incurred over $ 4.5 billion of debt.

Some fear that the new case Friday formalized rules that interfere with the negotiating are the largest banks with the attorneys general of 50 states on the issue of abuse that took place in mortgage lending.

Banks could indeed be reluctant to enter into this global settlement if they know of other state bodies are also likely to claim their money.

The major U.S. banks are already facing the possibility of having to pay tens of billions of dollars in settlement of disputes relating to their activity in the mortgage and their practices in foreclosure.

Such expenses would further reduce their capital levels and may reduce their ability to lend even as the housing market is at half mast and that the U.S. economy as a whole shows signs of slowing down.

Bank stocks suffer as signs that the Fed could start to sell short-term debt recorded in its books to purchase securities of longer maturity in order to lower long-term returns, as part of stimulus.

This action, known in English as "Operation Twist", could affect the margins of the banks that fund themselves short term and lend long term.

Sign of the concern surrounding the banking sector, the Federal Reserve has asked Bank of America to present the measures it would take if business conditions were deteriorating, reports the Wall Street Journal Friday, citing people familiar with the file.

Losses resulting from the accelerated deterioration of subprime and other mortgages have forced the government to nationalize Fannie Mae and Freddie Mac September 7, 2008. Since then, American taxpayers have spent over $ 140 billion to stay afloat these two pillars of real estate financing.

Japan is prepared to act on the foreign exchange market

Japan will act firmly against any speculation on currency markets, said Monday the Minister of Finance Yoshihiko Noda, thus demonstrating the will of Tokyo to fight against the soaring yen.

Yoshihiko Noda, who believes the upward trend of the yen as more and more unilateral, also indicated that Japan was in close contact with other countries on this issue.

"We will monitor the markets even more closely than before to detect any speculative activity.We leave open any measure, and we will act decisively when necessary, "he said.

The phrase was repeated several times during the day by the Minister of Finance himself, but also by the Prime Minister Naoto Kan and Secretary of the Government Yukio Edano.

Friday the yen hit a new historic high of 75.95 against the dollar. Anticipating action by the Japanese authorities, the markets have brought the dollar to rise to 77.23.Shortly before 0800 GMT, the dollar was trading against 76.70 yen.

Signs of strength in Tokyo, however, did not allow the equity markets to hide the fear of a return to the U.S. recession, and the Nikkei closed Monday down to a low of five months .

August 4, Tokyo intervened unilaterally in the currency market, but the operation did not prevent minvestisseurs continue to buy yen a safe haven in times of crisis.

According to Kyodo News, the trade minister said Monday Banri Kaieda coordinated action with the U.S. on currency markets would be preferable.

The names of Banri Kaieda and Yoshihiko Noda are most often cited to replace Naoto Kan when it leaves the head of the government, perhaps by the end of the month.

European shares fall further, fear of a recession

European shares ended down Friday, concluding a third straight week against a background of restless fears of a relapse into recession in major developed and sovereign debt crisis.

The CAC 40 index dropped 1.92% to 3016.99 points, but varied between a low of 2947.91 points (-4.2%) and a high of 3078.28 points (0.07% ).

For the week the index lost 6.13%, after falling 5.48% Thursday, bringing its slide to 17.82% since the beginning of the month.

"Above all, the anticipation of 'double dip' recession in the double way early 1980s, which haunted investors.This contraction is somehow accepted and caused by the austerity budget set up by European politicians, "said Eric Galiegue, president of Valquant.

Other major European markets, London has sold 1.01% 2.19% Frankfurt and Milan 2.46%. The European indices EuroStoxx 50 and 300 respectively Eurofirst fell 2.15% and 1.66%.Since the beginning of the month, the EuroStoxx 50 loose 19.15%, 13.32% and the London Stock Exchange German 23.45%.

On Wall Street, the S & P 500 fell by 0.15% and the Dow Jones 0.33% at midday in New York.

"The second quarter growth was well below expectations on many aspects: sluggish domestic demand, external demand risk and a clear concern about the financial variables, crystallized by market volatility," recalls Erick Muller Chief Investment Officer of Fidelity bond range.

The situation remains very FRAGILE

The implied volatility of the Eurostoxx 50 has remained virtually unchanged Friday (0.29%) but jumped 71.29% in three weeks.

"The month of August will bring real improvement on any of these points.The overall situation remains very fragile for the second half and the markets have adjusted the valuation of assets as a result, but suddenly long term, "said Erick Muller.

In this context, cyclical stocks and banks have once again suffered, Renault (-4.69%) showing the greatest decline in the CAC 40 lost 4.27% BNP Paribas in Paris.

Elsewhere in Europe, banks Unicredit and Lloyds fell 4.8% and 5.8%, while car manufacturers Porsche and Fiat gave up 4.45% and 4.3%.Their respective sector indices ended lower by 1.81% and 2.86%, the car even accusing the largest decrease sector.

Since the beginning of the month, European banks have unscrewed from 21.85% and 27.74% of the car.

The same causes leading to the same effect, investors fled to the assets with the least risk, such as gold, which recorded a new record of 1,877 dollars an ounce and earns nearly 14% since late July, or Yields on government bonds rated.

The rate of the 10-year Bund and of the French OAT maturing well remain virtually unchanged in late afternoon around by 2.1% and 2.77%, after falling in the morning at 2.031% and 2.713%.

"Despite the deterioration in the rating of the United States by Standard and Poor's, despite concerns in general about the astronomical amounts of public debt, interest rates on government bonds with very broad market fall," Valquant said in a weekly strategy note.

"This is a sign that investors are in full 'flight to quality', and they seek refuge in government debt," says the company.

Wall Street expects a lot of indicators and quarterly

Still reeling from the worst three weeks that the U.S. markets have been in two and a half years, investors should seek from this Monday a break.

The blow by Standard & Poor's debt to the United States now behind them, the market should turn to the outlook for the U.S. economy and also look for evidence that policy makers in the euro area are able to limit the crisis debt.

The meeting Tuesday of Nicolas Sarkozy and Angela Merkel in Paris should therefore be decisive for the markets.

The movement of widespread sale last week's losses increased in the S & P 500, which fell by 12.4% since July 22.If there is no indication that this trend is over, the sessions Thursday and Friday, however, ended up with lower volatility.

The week begins would be quieter, especially if the expected economic indicators still away the prospect of a return of U.S. recession.

"Each number indicates that the economy is not heading into recession will be a calming factor for the market in the coming weeks," said Peter Cardillo, economist at Global Rockwell Capital in New York.

Indicators next week will be closely monitored, including regional studies conducted by the Federal Reserve Bank of New York and Philadelphia on manufacturing and sales in real estate.

The manufacturing sector is currently one of the stronger U.S. economy, but the ISM report for the month of July, published on 1 August, reported an unexpected slowdown.

However, other more recent data, including sales to detail () suggests that the U.S. economy manages to stay the course.

The results of the distribution groups are also clear from the horizon, and quarterly giant Wal-Mart, expected Tuesday, are eagerly awaited in this regard.

According to data compiled by Thomson Reuters, earnings for the group should have increased by 11.8% in the second quarter.

Several other major retailers as well as computer must publish in the week, including Dell and Home Depot on Tuesday, Wednesday Target and Gap, and Hewlett-Packard on Thursday.