Banking Crisis

Over the last week (okay the last year) the credit crunch has been causing major problems in the financial world.

The BBC has a whole section devoted to the crisis.

United States of France

This article from Time magazine made me smile.

This is the state of our great republic: We’ve nationalized the financial system, taking control from Wall Street bankers we no longer trust.

We’re about to quasi-nationalize the Detroit auto companies via massive loans because they’re a source of American pride, and too many jobs — and votes — are at stake.

Our Social Security system is going broke as we head for a future where too many retirees will be supported by too few workers.

How long before we have national healthcare? Put it all together, and the America that emerges is a cartoonish version of the country most despised by red-meat red-state patriots: France.

Only with worse food.

The USA has always been seen as a market economy, whilst many of the economies in Europe are seen as mixed.

A game of monopoly that changed the rules of British banking

Heather Connon in the Guardian writes

Lloyds TSB snatched the Halifax from the jaws of the credit crunch – but with thousands of jobs on the line and HBOS’s capital problems far from solved, the giant new bank will need skilful handling to ensure that it is a success.

The merger was quickly passed by the government.

…the Office of Fair Trading, which blocked Lloyds TSB’s attempt to acquire the much smaller Abbey National seven years ago, has been forced by the government to wave this deal through.

Generally if a bank merger this size was going to take place, questions would be asked.

Photo source.

FTSE posts biggest one-day rise

BBC reports on the “bounce” back on the financial markets.

The FTSE 100 share index has closed more than 400 points higher, its biggest one-day rise, after the US confirmed a financial bail-out plan.

It ended the day 8.8% higher at 5311.3 points. But after a turbulent week on the markets, the FTSE was 105 points lower than its value on Monday. 

Alitalia ‘running out of fuel’

BBC reports on how Italy’s national airline may be “running out of fuel”.

Italy’s national airline, Alitalia, may have to cancel some flights because of a lack of funds to buy fuel, a top official has warned.

The competitive nature of the airline industry combined with huge increases in the cost of fuel is hitting airlines hard. Only a few days ago, XL collapsed leaving thousands of holidaymakers stranded abroad.

50% off, or is it 33%?

A 100% increase sounds impressive.

A 100% increase from one in a million becomes two in a million. So what?

The BBC News Magazine is running a really nice series on maths. In this article they are looking at percentages.

A percentage is not really a number, it is a share. The simple question to keep in mind is one that always strives to put it into a proper, human context: “A share of what? A share of a lot – or a share of a little?” Better still: “A share of who?”

Business organisations need to be careful when playing with percentages, in some cases if they mess up they can end up in court.

Okay, it’s old, but still funny…

I was reminded of this amusing Microsoft iPod branding video which was leaked.

Still funny.

Though if you look at the Zune, they did learn their lesson.

Bank keeps UK interest rate at 5%

BBC reports

The Bank of England has kept interest rates on hold at 5% for a fifth month as it struggles to deal with a slowing economy and soaring inflation.

Gucci and Hermes ride out the consumer slowdown

Though there are fears that the UK is entering a recession, the Guardian reports on how some firms making luxury products are still making profits, despite the adverse economic environment.

Luxury goods firms are benefiting as much from the economic turmoil as low-cost food and clothing companies at the other end of the retail spectrum.

Luxury brands Gucci and Hermes today posted sparkling profits as fears of recession in traditional markets were brushed aside by soaring demand from the well-off in emerging economies and nearer to home.