Archive for the ‘global financial’ Category

Asia stocks lackluster, China stimulus hopes wane

November 11, 2008

Most Asian stock markets retreated Tuesday after weakness on Wall Street, as concerns about the global economy sapped enthusiasm over China‘s nearly $600 billion package to boost growth.

Tokyo’s Nikkei 225 index was down 272.13 points, or 3 percent, to 8,809.30 as the yen strengthened against the dollar. In Hong Kong, the Hang Seng benchmark was 2.2 percent lower at 14,407.45 points.

Australia’s benchmark fell 3.6 percent. Markets in Singapore, South Korea and India also declined.

The Shanghai Composite index, up earlier in the session, fell 1.5 percent despite figures showing the country’s inflation rate eased further last month.

By JEREMIAH MARQUEZ, AP Business Writer

In this Feb. 16, 2008 file photo provided by China's Xinhua ...
In this Feb. 16, 2008 file photo provided by China’s Xinhua News Agency, workers prepare for construction of a new project Shanghai Center at the building site in Pudong District of Shanghai, east China. China’s economy is still growing at an enviable rate: It expanded 9 percent in the quarter ending Sept. 30, 2008. But that was the slowest in 5 years and down from 11.9 percent last year. Forecasts for next year range as low as 7.5 percent.(AP Photo/Xinhua, Niu Yixin, File)

Regional equities were up sharply Monday on hopes that China’s 4 trillion yuan ($586 billion) stimulus package, announced Sunday, would keep its economic growth from falling too fast and help fuel demand for exports from other Asian countries.

But the rally proved short lived amid fresh evidence of more economic troubles.

In the U.S., major electronics retailer Circuit City Stores Inc. filed for bankruptcy protection. Investors also speculated about the fate of General Motors Corp., Chrysler and Ford Motor Co. after the automakers met with lawmakers last week in hopes of securing financial help.

In Asia, Japan’s government reported the country’s current account surplus in September plunged almost 50 percent from a year earlier as export growth waned in the face of a global slowdown.

“It’s what I’d term a ‘fally:’ a rally based on fallacy,” Kirby Daley, senior strategist at Newedge Group in Hong Kong, said of Monday’s advance. “The fallacy being that the China stimulus package is the answer to all of Asia’s problems. While it will help and is a step in the right direction, it will not fully insulate Asia from feeling the impact of the global downturn.”

Read the rest:
http://news.yahoo.com/s/ap/20081111/a
p_on_bi_ge/world_markets_22

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Obama Should Make Haste Slowly

November 7, 2008

Festina lente. Make haste slowly. That was the motto of the revolutionary-minded young Augustus who soon grasped that he needed to build upon Rome’s past, rather than dismantle it.

Amid the celebration of the historic victory of Barack Obama, the country should now quit the bickering, appreciate a fair and peaceful transference of power, and unite behind its new commander in chief.

By Victor David Hanson
The Washington Times

But in turn our new President Obama would do well to heed that ancient Roman wisdom, appreciating that the real world after Nov. 4 is not exactly the same as its frequent caricature during the hard-fought campaign.

John McCain promised to cut taxes on all. Mr. Obama promised to raise them on some. But neither plan fully appreciated that we are now buried deep under trillions of dollars of debt – and need both more revenue and less expenditure.

An Obama administration, like it or not, must cede to the laws of physics: America will have to pay down debt while not raising taxes too high at a time of recession. That balancing act will make it hard to borrow additional billions for more promised federal spending.

“Hope and change” may have implied an easy transition to our clean, cool solar and wind future. But for a while longer, America’s envisioned new electric cars will still require old-fashioned natural gas, coal and nuclear power to generate electricity to charge them.

Economic slowdown, conservation and public promises to drill more oil and natural gas have already helped to collapse world oil prices and saved us billions. And before we talk of ending the coal industry, we should thank our lucky stars that America has the world’s most plentiful supply of coal to transition us to alternate sources of energy.

We need more regulation of both Wall Street and Fannie Mae and Freddie Mac, which all went feral and turned on us during both the Clinton and Bush administrations. Yet European leaders are faced with far worse financial meltdowns than we are – and their problems have nothing to do with American excess or George Bush.

The dollar is climbing against the Euro because market analysts realize that for all our sins, American financial institutions are still far less exposed than those elsewhere in the world, and our free-market system far more flexible to recover from excess and grow the economy.

Some have called for the Wall Street bailout to be just the first, rather than the last, large federal takeover of American finance. But again, we should remember that despite a looming recession, Americans are still collectively the most affluent and free citizens in the world – precisely because our unique free-market system creates enormous wealth and draws in more capital and talent than elsewhere on promises of commensurate individual rewards. President Obama need not give radical chemotherapy to an ill economy that does not have a fatal cancer.

The shooting war in Iraq is ending. President Obama can continue to withdraw American troops slowly on the basis of a growing victory, rather than rashly and harnessed to an artificial timetable. In time, a Democratic administration could assert that a constitutional government in Iraq and an unprecedented defeat of al Qaeda in the heart of the ancient caliphate enhanced U.S. security at home and abroad – and are achievements to be claimed rather than simply reckless acts to be abruptly abandoned.

For all the campaign charges of unfairness, America currently has the most progressive tax system in the world, in which the top 5 percent of wage earners pay over 60 percent of all federal income taxes. President Obama will raise rates, as promised. Yet he might consider that Americans in the past came to accept the Clinton income tax hike to 40 percent on the top bracket – but may well balk at adding unprecedented increases in payroll taxes on top of all that. That combination could mean a sizable tax raise on many of those self-employed who already pay nearly half their income in various taxes – and gut rather than just shear the sheep.

Read the rest:
http://www.washingtontimes.com/news/2008/nov/
07/make-haste-slowly/