How all this affects you (link)

The BBC have an excellent article explaining how this turmoil in the markets affects you. It's definitely worth a read!

http://www.bbc.co.uk/news/business-14418290


Regards,
Sam

US Debt Deal Made

Congress has passed the bill that will increase the debt ceiling and allow the US to avoid defaulting.

The debt ceiling has been raised to $16.7 tn (increase of $2.4tn from $14.3tn).


Regards, Sam

Source:
http://www.bbc.co.uk/news/world-us-canada-14379240

House of Representatives agree debt bill

Now eyes are on the Senate waiting for them to approve the bill.

Stay updated for updates.


Regards, Sam

Updates Around The World

In the US:

The US debt ceiling has been a hot topic. Obama and republicans have clashed over requests to raise the debt ceiling and plans to reduce government spending and to raise taxes. If a new deal is not made by early August we may find the world's foremost government defaulting on its debts - not good news.

In the UK:

Across the pond in the UK figures have been released by the ONS (Office for National Statistics) of the Q1 GDP showing 0.02% growth. This figure is way below forecasts of 1.7% growth for 2011. Analysts put this down to negative factors such as the  Japanese Tsunami, however they also note the positive role the royal wedding had on GDP growth.


Kind regards,
Sam

New Greek Bailout Agreed

A 135bn euros over 30 years ballout has been agreed by Eurozone members and will, this time, include private investors.


Markets reacted positively to news that an agreement had been reach with the FTSE 100 climbing to 5,900 (+0.79%) and Eurofirst 30 to 1,100 (+1.10%)




Regards, Sam

Markets Dip As Debt Crisis Continues

The FTSE and the Dax have fallen 1.08% and 1.09%, respectively, and Cac 40 has fallen 1.39% as the markets react to Bank Stress Test results released by the European Banking Authority and more worries of the debt crisis. Gold has hit $1,600 as investors seek stability in the commodity over currencies and equities.

Eyes are now looking to policy makers in the US and Europe for debt deals to be made to boost confidence.



Regards,
Sam

'Chaos Monday'?

European banks failing stress tests and Euro crisis concerns may cause a chilling reaction in the markets on Monday.

Harry Wilson and Phillip Aldrick from The Telegraph believe that there will be chaos on the markets as investors and analysts claim that the stress tests were over optimistic and inadequate. Emma Rowling (also from The Telegraph) reports that global equities could lose up to 38 percent of their value at the most extreme prediction or 12 percent at a much milder prediction. ArabMoney.net are also predicting a 'horrible trap' ahead for investors.

One things for sure - I'll be keeping my eyes wide open on Monday!

Regards,
Sam

8 Banks Fail Stress Test

Out of 91 banks the European Banking Authority found 8 banks lacking the means to avoid another financial crisis.

The Telegraph notes that 5 Spanish banks, 2 Greek Banks and 1 Austrian bank had failed.

This news, coupled with their other findings of 16 banks in the 'danger zone, is very worrying for the banking industry.


Regards,
Sam

Sources:
http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/8641012/European-stress-tests-Eight-banks-fail.html

http://www.bbc.co.uk/news/business-14169940

US Government Debt Rating In Question

Credit rating agencies are currently reevaluating the AAA debt rating of the US government. Moody's and Standard and Poor have both announced that they may downgrade the rating.

What will this result in if they are cut? I hear you ask. Well, if these rating agencies downgrade the investment grade on the US government there will be several repercussions:

-Firstly it will cost the US government more to borrow money
-It will decrease investor confidence in government bonds
-And lead to an overall negative effect on the US economy

Kind Regards,
Sam

Bank Stress Tests

Ten European banks have been tested by the European Banking Authority and results are to be published later today. In total 90 banks are being tested including Lyold's Banking Group and the Royal Bank of Scotland.

These tests are a more hardened version of the previous stress tests after there were concerns that they were not testing enough.

Banks will be required to publish their sovereign debt exposure to the public and then for the public to come to their own conclusions about the data and to the strength of the banks.


Stay tuned for a quick update on these results later.

Kind Regards,
Sam

Cross Cultural Management: British and Chinese work culture

Britain and China, they're world apart and very visibly culturally different but how so? Under closer examination – with the help of Hofstede's research, they share a surprising amount of cultural similarities when it comes to the workplace.

But first a quick refresher on Hofstede: Geert Hofstede conducted research in the early 90's on the cultural differences of the international branches of IBM. He categorised his findings into 5 dimensions (Power Distance, Individualism, Masculinity, Uncertainty Avoidance, Long Term Orientation).

Risk Takers

These two cultures share a common trait in coping with ambiguity. British and Chinese branches of IBM exhibited a low score in Uncertainty Avoidance, below the world's average score. What's the significance of this? - Both cultures can undertake risks comfortably.

Taking risks is an essential part of business, as this article explains: http://members.chiefexecutive.com/display_article.asp?id=37035

Competitive nature, achievement based

Both cultures also showed an above average score in masculinity. This means that these cultures are very assertive and competitive.

The implications of this on the workplace and management being that successful workplace in these cultures may be competitive commission or reward based working environments. Utilising the cultures competitive and achievement based qualities to increase productivity.

I hope you've enjoyed this post as much as I have researching it.

Regards,

Sam

Supply Chains: Let's get global!

'Never break the chain'. Harrowing words from Fleetwood Mac and very appropriate for this blog entry on global supply chains.

In this entry we'll be identifying two advantages from operating a global supply chain

Competitive

First off the mark, they're extremely competitive. Businesses from other countries have to increase their standards, due to the competitive nature of the 'globalised' world. Because of the many suppliers and contracts available, firms can reduce the amount of stock that needs to be stockpiled.

Flexibility

The ability to respond rapidly to changes to supply chain speed, destinations and volume is a great asset for any firm to have. Firms with global supply chains have a greater supplier selection with multiple sourcing options.

There are many more advantages... and disadvantages such as security problems, demand variations and huge investment costs. But I wanted to keep this entry short and interesting.

Regards,

Sam

Source:

Pravin Kumar et al (2008) Flexibility in Global Supply Chain: Modelling the Enablers, Journal of Modelling in management,Vol 3 No. 3 2008

Blog Changes

Greetings everyone,

It is with great pleasure I can reveal that this blog is now under the ownership of Rooleys: A blog collection of  interesting topics including Business, Economics, Science and Engineering.

Regular blogging will now resume!

Follow Rooleys at :http://twitter.com/#!/rooleys


Regards, Sam

UK Budget 2011

Hi all,

The UK budget was released yesterday by George Osborne (UK Chancellor of the Exchequer). Come back tomorrow for an analysis of the repercussions and effects that may happen due to this budget (Mainly as I'm short on time! :S) 


Regards, Sam

Bank of England - Interest Rates

Hi everyone,

Continuing on from yesterdays post of the UK inflation figures, the Bank of England has decided to keep interest rates at its historic low of 0.5%.

The policymakers voted to keep the rates the same to keep in line with their medium term goals.


--

Thanks for the comments yesterday, I'll explain some of these terms:

The CPI (Consumer Price index) and RPI (Retail Price Index) is how the Government (UK in this sense) measures inflation; they measure the price of household goods and compare them year on year.

Raising the Interest rates means there will be a higher cost in borrowing money, yet the value of the currency will increase, increasing the incentive to save (a savings account will have a higher interest rate).

Interest rates were cut in many countries (USA, UK e.g.) to stimulate economic growth because of the banking crisis.


Regards, Sam

UK: CPI and RPI figures released

The CPI rose to 4.4% and the RPI rose to 5.5% both record breaking highs.

This may put the Bank of England under a lot of pressure to raise the interest rates. Tomorrow they'll be releasing their minutes to come back tomorrow for an update.


Regards, Sam

Inflation, Inflation, Inflation.

Hi all,

With the UK Consumer Price Index and Retail Price Index being announced on Tuesday and the Bank of England Interest Rate Minutes on Wednesday, I thought it would be very topical to mention inflation.


Thanks to raising food prices and fuel costs, it seems a few nations are experiencing rising inflation ahead of their targets. In the UK, inflation is currently double the Bank of England's target of 2 percent, if the figure is still unchanged or has increased on Tuesday, the Bank of England may take action by raising interest rates - which is bad for borrowers, especially those on tracker mortgages!


If you fancy checking out the inflation rates in different countries, the Telegraph have an excellent article:
http://www.telegraph.co.uk/finance/economics/8389042/Global-inflation-in-graphs.html


Regards, Sam

Weekend Recess

That's it for this week!

Come back on Monday for more posts.

Regards, Sam

A Global Currency?

Out of the economic plight (read 2009) China proposed that there should be a single global currency, which
Geithner in 2009 remarked that the US is 'open' for ideas about a world currency. This would involve replacing  the US dollar based system by increasing IMF's special drawing rights

Brazil, India and Russia seem warm to the arrangement. But do you?


What are your views on a global currency?




Regards, Sam

Some Good Economics Blogs

Hi guys,

I've compiled some blogs that I've found very interesting - that also relate to economics or anything business related! - I'd advise you to check them out when you can.

OR

You can give me some recommendations in the comments below!

---

Scootland Economics: http://scootland-economics.blogspot.com/ - In depth papers

Currency Trading: http://tradingcurrencyguide.blogspot.com/  - Good for updates on FX

Nathan's Economic Edge: http://economicedge.blogspot.com/ - Views on world events

Thoughts on Economics:  http://robertvienneau.blogspot.com/


Regards, Sam

Chartered Cities

Hi folks,

In this blog I'd like to know your views and thoughts on alleviating poverty.

Here's a video of Paul Romer sharing his idea of chartering cities in developing countries.

The goal of this is to great cities such as Hong Kong, which are economically brillaint and will bring a lot of people out of poverty.

-

-


Regards, Sam

A real alternative to oil?

Cella Energy, an Oxford based company, has claimed that it can produce a petrol replacement available in the next three years.

This fuel is hydrogen, but its innovative application is that it is stored in 'beads' and would not need to be stored in an expensive and potentially dangerous way it is stored at present.

This would mean that petrol would be much cheaper than current costs, with little infrastructure investment to implement the fuel.

Maybe this will loosen our dependence on oil, and give much less power to OPEC nations?


If you would like to find out more about this, visit their website: http://www.cellaenergy.com/


Regards, Sam

Developing Countries

Hello again guys and gals!

In this post I would like to know your thoughts and views on multi national corporations operating in developing countries; their impact on their economy and the workers pay and conditions.

Regards, Sam

Opportunity Cost

Thought my blog wasn't as interactive as I would have hoped. So in this post I'll be asking you a question about opportunity costs.

If you went/are going to college, what was your opportunity cost?

Mine, for example was sacrificing my old job, which over three years would have brought in £36,000 (~$57,000); attending college cost me ~£21,000 (~$33,000) when taking into account tuition fees and loans.

So overall, my opportunity cost for attending college was £15,000 (~$24,000)

...an interesting link: http://www.owen.org/blog/283

Regards, Sam

Selected economic announcements - Friday 25th

INTERIMS 
Asian Citrus Holding 

INTERIM DIVIDEND PAYMENT DATE 
ACM Shipping Group, Fletcher King, NCC Group 

INTERIM EX-DIVIDEND DATE 
Sara Lee Corp. 

QUARTERLY PAYMENT DATE 
Equity Partnership Inv Co Income Shares 

INTERNATIONAL ECONOMIC ANNOUNCEMENTS 
Consumer Price Index (GER) (07:00) 
M3 Money Supply (EU) (09:00) 

FINALS 
Berendsen, Brit Insurance Holdings NV (DI), Hellenic Telecom Industries SA ADS, Lloyds Banking Group, Rank Group, Rightmove, Spectris, Telefonica SA, William Hill 

ANNUAL REPORT 
Hunting 

SPECIAL DIVIDEND PAYMENT DATE 
International Power, Victrex 

EGMS 
Aminex 

AGMS 
Brewin Dolphin Holdings, Treatt 

TRADING ANNOUNCEMENTS 
ClearStream Technologies Group 

UK ECONOMIC ANNOUNCEMENTS 
GDP (output, income & expenditure) (09:30) 
Index of Services (09:30) 

FINAL DIVIDEND PAYMENT DATE 
United Drug, Victrex, Zytronic


Keep updated on this blog for more updates on Sunday, and stay ahead of the curve!


Regards, Sam

Libya unrest affects oil prices

With the ruckus going on in the Arab state, US oil prices have spiked.

More updates coming...



Regards, Sam

Apologies

Good day everyone,

In this post I would like to apologize to all those following this blog for the lack of posts in the last week.
Unfortunately I had been struck down with illness so was unable to post. However, now that I am chirpy again more economic updates will flow!


Regards, Sam

Tomorrow 's Economic Announcements

Stay up to date! Announcements scheduled for tomorrow:


INTERIMS 
Avingtrans 


INTERIM DIVIDEND PAYMENT DATE 
Ashtead Group, Halma, Workspace Group 


INTERIM EX-DIVIDEND DATE 
City of London Investment Group, Clyde Process Solutions, Murgitroyd Group, Penna Consulting, Puma High Income VCT , Stagecoach Group 


QUARTERLY EX-DIVIDEND DATE 
BP, GlaxoSmithKline, JPMorgan Claverhouse Inv Trust, Royal Dutch Shell 'A', Royal Dutch Shell 'B', Unilever 


INTERNATIONAL ECONOMIC ANNOUNCEMENTS 
Consumer Confidence (JPN) 
Machine Tool Orders (JPN) 
Machine Orders (JPN) 
Domestic CGPI (JPN) 
Balance of Trade (GER) (07:00) 
Current Account (GER) (07:00) 
Retail Price Index (GER) (07:00) 


UK ECONOMIC ANNOUNCEMENTS 
BRC Shop Price Index (00:01) 
Visible Trade Balance (09:30) 
Non-EU Trade Balance (09:30) 


GMS 
Pathfinder Minerals , Private Equity Investor 


FINALS 
Coca-Cola Hellenic Bottling Company SA, CSR, Smurfit Kappa Group, Telecity Group, THB Group 


IMSS 
Cable & Wireless Communications, Daily Mail and General Trust, Grainger, Quintain Estates & Development 


SPECIAL EX-DIVIDEND PAYMENT DATE 
International Power, Victrex 


EGMS 
Subex Ltd. GDR (Reg S) 


AGMS 
Albion Income & Growth VCT, Daily Mail and General Trust, Future, Grainger 


FINAL DIVIDEND PAYMENT DATE 
Edinburgh Worldwide Inv Trust 


FINAL EX-DIVIDEND DATE 
Artemis VCT, Impax Asset Management Group, Sage Group, Victrex, Zytronic


Source:Sharecast

Currency War: Brazil vs. China

The US has voiced support for Brazil in their "currency war" with China. US Secretary of the Treasury, Tim Geithner, has criticised undervalued currencies leading to Brazil receiving a disproportionate amount of global capital inflows.

The Brazilian currency, the Real, has been damaged by foreign investment and a increase of cheap Chinese imports.

Source: Telegraph

China Raises Interest Rates

The Chinese central bank has raised interest rates to 6.06% to tackle inflation.

The Chinese economy has experience strong growth, 9.8% in the past three months, however there are some bearish views from speculators who are predicting a housing bubble due to spiralling costs among other factors.


http://www.telegraph.co.uk/finance/economics/8310887/China-raises-interest-rates-for-third-time-in-four-months.html

http://www.telegraph.co.uk/finance/china-business/8290457/China-syndrome-means-country-faces-dangerous-property-bubble.html

Financial Problems for Egypt

The Egyptian government is facing a financial dilemma as investors pull out their capital in response to the ongoing turmoil. After a bond auction today, Egypt failed to raise enough money. In response the Egyptian pound fell in value against the dollar and other currencies.


Source: BBC News

Copper Prices Soar!

Copper broke through to $10,000 a tonne last month, with Religare speculating that it will increase to $11,000 at the end of the year. Possibly due to increase demand from China and a drop in copper supply.



Source:
http://www.telegraph.co.uk/finance/markets/8307108/Copper-market-continues-to-soar.html

Upcoming Economic Events

Tuesday February 08 

INTERIMS 
Mcbride 

QUARTERLY EX-DIVIDEND DATE 
IBM Corp. 

INTERNATIONAL ECONOMIC ANNOUNCEMENTS 
Bankruptcies (JPN) 
Bank of France Business Sentiment (FRA) (07:30) 
Trade Balance (FRA) (07:45) 
Industrial Production (GER) (11:00) 
NFIB Small Business Optimism (US) (12:30) 

Q4 
BG Group, Wolfson Microelectronics 

GMS 
Melrose Resources 

FINALS 
Beazley, Low & Bonar, Patsystems, Wolfson Microelectronics, Xstrata 

IMSS 
Mcbride, Thomas Cook Group 

AGMS 
Renovo Group, Victrex 

UK ECONOMIC ANNOUNCEMENTS 
BRC Retail Sales Monitor (00:01) 
RICS House Price Balance (00:01) 


Producer Prices (09:30)


source:Sharecast