U.S. has much to prove on new bank capital rules 23 Sep 2010 America delayed and then barely implemented the last set of Basel standards, so Europeans are rightly skeptical about the new accord's fate. The FDIC's Bair and Treasury's Geithner are pushing deadlines. But U.S. bank regulation remains fragmented and similar pitfalls may await.
Economy tests diminishing return of college degree 23 Sep 2010 The salary differential with nongraduates has shrunk even as the cost of a fouryear university degree keeps rising. Like home ownership, education provides more than just a financial benefit. But it's another part of the American dream that needs rethinking.
Sarkozy’s lows aren’t just a local matter 23 Sep 2010 France is on strike again, the president's popularity is at an alltime low and EU allies have been antagonised over the Roma. Sarko is due to be G20 chairman next year. If tensions flare up over global imbalances, the last thing the world will need is a weak chairman.
Moscow mayor’s troubles catch out an oligarch 23 Sep 2010 The Kremlin's battle to oust Moscow's influential mayor Yuri Luzhkov has caught an oligarch, potashandgold king Suleiman Kerimov, in the crossfire. Kerimov can probably weather the storm. But the freezing of his assets in Cyprus is a timely reminder of Russia's political risk.
GM sensibly eases off the gas on IPO 23 Sep 2010 The offering may now wind up at only $10 bln. There s even a chance Uncle Sam will remain the majority shareholder. Tempering earlier ambitions might mean eating humble pie. But with GM still recovering and markets choppy, a smaller IPO stands more chance of success.
Reversing Obama is insufficient agenda for GOP 23 Sep 2010 The party of no has revealed what it will say yes to. But a new Republican manifesto offers little more than undoing Obama s reforms, with vague talk of balanced budgets. Maybe that s smart politics. But America s longterm economic and fiscal woes call for bolder leadership.
Summers’ exit a chance for détente with business 22 Sep 2010 If deftly handled, the departure of brilliantbuttesty White House economic adviser Lawrence Summers could be addition by subtraction. Summers' departure gives President Obama an opportunity to fill a gaping hole in his administration's skill set: private sector experience.
Vatican still at pains to deal with Mammon 22 Sep 2010 Two executives at the Vatican's bank are being investigated for money laundering. The Catholic Church is perplexed and amazed. However painful it may be to submit to Man's laws, Rome must accept the fact that the rising demand for transparency extends to its financial empire.
Right infrastructure bank could help U.S. makeover 22 Sep 2010 American transport and power systems need an overhaul that could cost $2 trillion. But if Washington wants to create a bank to fund big projects, it needs to be worthy of the name. Lending decisions must be based on transparent financial criteria, not subject to political whims.
Fed readies second mortgage on U.S. future 21 Sep 2010 Continued nearzero interest rates and the additional monetary stimulus hinted at by the Fed are meant to nurse sluggish growth. But the policy risks encouraging bad lending and corporate investment decisions. America s competitive capital edge looks increasingly threatened.
Obama’s Wall Street bark still worse than his bite 21 Sep 2010 Hedgies made out OK in financial reform. Yet at a town hall meeting, one manager asked when the president would stop whacking Wall Street like a piñata. Though he should ve kept schtum, his comments suggest it has been presidential rhetoric as much as new rules irking industry.
U.S. foreign tax rules look ill-conceived 20 Sep 2010 Washington wants foreign banks and brokers to help it keep track of American citizens, or face a hefty levy. Big firms will have to comply, but smaller ones may prefer to stop accepting U.S. clients. The administration shouldn't expect its lenders to be welcomed abroad.
Svyazinvest row is fresh blot on Russian business 17 Sep 2010 The Russian telco is a hotbed of conflict and resignations. Behind the public bickering lies what looks like battle for management control of the state's growing telecoms empire, which raises concerns about links between state and private interests.
Is Marchionne Italy’s Thatcher? 16 Sep 2010 The Fiat CEO's threat to move the carmaker's production abroad if unions don't accept productivity gains is real. There are echoes of Thatcher's clash with British unions in the 1980s. If he triumphs, it could be the start of a new era for industrial relations in Italy.
Obama tweaks fine print for his consumer champion 16 Sep 2010 Coming from a credit card issuer, Elizabeth Warren might not like that. But Main Street will welcome having her setting up the U.S. consumer financial protection agency. The president may not care that Wall Street feels differently. Still, the manner of his pick carries risks.
Landesbanks may struggle even with Basel III delay 16 Sep 2010 Germany's regional lenders have been given a lenientlooking 13 years to comply with new bank capital rules. But local governments don't want to pump in more cash and weak earnings won't make up the shortfall. Balance sheet shrinkage and consolidation look the only way forward.
UK runs high risk of a dip in 2011 15 Sep 2010 Consensus says the UK recovery will continue next year. But big government spending cuts, public sector job losses, tax increases, houseprice falls, slipping wages and struggling exports suggest the UK faces a high chance of recession even if the global economy is recovering.
Japan’s yen intervention shows welcome activism 15 Sep 2010 For the first time in six years and the day after prime minister Naoto Kan retained his post, Japan's finance ministry sold yen to weaken the currency. The Bank of Japan is now murmuring about monetary policy loosening. The newfound urge to combat deflation is a big step forward.
U.S. election upset defeats promise of compromise 15 Sep 2010 A Tea Party conservative win in Delaware s Republican primary for Senate serves notice to moderates. It means if President Obama shifts to the center, he may find no one there. Gridlock is often marketfriendly, but the trend could be jeopardized by the needed budget overhaul.
Fiscal prudence likely loser in Brazil election 15 Sep 2010 Public spending has increased sharply this year, and more than 60 pct of Brazilians support candidates favoring more of it. Reducing public debt should be the economic priority for whomever wins next month's presidential election but don't bet on it happening.