Tonight's Profitable Moment....from Quest Means Business
So with what is the road to recovery paved ? We certainly know rose petals aren't being strewn in our path. But is it right to say we are on a road to hell as the Czech prime minister described Obama's economic policy.
No one doubts the road has deep pot holes. The evidence of a hard journey ahead is everywhere. Large budget deficits that will be millstones round our necks for decades are piling up. Homes are being lost, there is virtually no economic cheer – and the best we can hope for is a tepid growth later in the year. This much we already know.
But what makes the journey hellish ? Is it the fear of the unknown, or the near certain fact that our standards of living are going to fall. Perhaps we are now so much in love with the latest gadget and mobile gizmo that the thought of anything else sends us into despair. I find that hard to accept. We can do better than define our journey being consumed by the latest consumer trinket.
Whether it's the road to recovery or hell – there are many twists, turns and cul de sacs. We won't always agree on the best route to get us home. There is no Satnav to economic nirvana.
Toyota has unveiled the much-anticipated third generation of it's best-selling Prius hybrid car, promising greener credentials, better performance and a smoother ride - but with cheaper rides competing for its slice of the dwindling car market, can it deliver?
Similar in appearance to the previous two generations, the Prius 2010 stands out, say engineers, when you drive it.
"This time, we have both engine and motor strength. A balance between performance and fuel efficiency," says the Prius' chief engineer, Akihiko Otsuka.
The new version of the Prius, the world's best-selling hybrid vehicle, boasts 10 percent increased fuel efficiency, its makers say. Engineers claim their success with this version comes with increasing performance, jumping engine size from 1.5 liters to 1.8 liters and boosting horsepower from 110 to 160. Engineers say the increased performance was met by keeping the weight of the car down and improving aerodynamics.
CNN was invited to test drive the prototype, due to release worldwide this year. The new Prius has three driving modes to give the driver options to increase fuel efficiency, from an "eco" to "EV" to "power" mode. The power mode focuses on performance, so the vehicle drives like a sporty sedan. The EV and eco mode will remind Prius fans of the first and second generation models.
Driving it on the Fuji Speedway, it seemed to deliver on the engineers' promise of performance, hitting 70 kilometers per hour in seconds. But that was in power mode. In eco-mode, the Prius matched the familiar, quiet (and much slower) pick up of the second generation. The engineers say to get the 10 percent fuel efficiency improvement, you can't exactly drive that sporty power mode all the time.
The Prius also continues to forge ahead with eco-friendly touches, like a new solar panel on the roof that runs vents in the summer to keep the car cooler when idle.
Toyota is banking on the popularity of the hybrid as a bright spot in what's been a sagging portfolio since the credit crisis began. But analysts say that expected profit could be smaller, thanks to a challenge from Honda.
Honda re-introduced its Insight, an updated model of Honda's first stab at the hybrid race. The Insight is priced lower than the Prius, approximately US $3,000 less. Toyota says despite media speculation that it would lower the price of its 2010 Prius, the current price won't waver. Analysts say the success of the new Prius depends on what the car buyer is willing to pay for in this recession.
"No doubt the Insight is a lot cheaper than the Prius," says Credit Suisse auto analyst Koji Endo. "But at the same time, the Prius is supposed to be a little higher quality and little bit more luxury segment. The Prius should have low emission, better fuel mileage and higher quality standards. So the question is, are you going to pay for price or are you chasing the performance?"
The Prius goes on sale in the US in late spring, mid-May in Japan, and early summer in Europe.
The cat is out of the bag in Britain in a big way. The warning by the governor of the Bank of England AGAINST a further large stimulus package was a slap in the face to Gordon Brown's government .It is in the very nature of Central bankers to be cautious – to proceed ponderously when others wish to rush, but Mervyn King left no doubt as to his views. ""Given how big these deficits are", King said, "I think it would be sensible to be cautious about going further in using discretionary measures to expand the size of the those deficits."
In Quest-speak Whoa....time to start worrying about how we are going to pay the bills when this is all over.
The Gov. was speaking before a parliamentary committee and would have been well aware of the bomb he was dropping on the UK governments head. Normally he would never be so blunt. Coming just a week before the G20 meeting it is an explosion indeed.....giving Gordon Brown's European counterparts Angela Merkel and Nikolas Sarkozy good ground for saying "hang on, even your own central bank chief believes enough is enough !"
The issue isn't more needs to be done: The problem is so much has been done already, in such a short period of time, and not just in the UK.
We have had record breaking cuts in interest rates (in less than two years they have fallen 5.25 per cent !) to record breaking lows. We have had record breaking Stimulus Packages and Bailout packages and we have seen central banks embark on record breaking printing of money known as Quantitative Easing. All of which will create record breaking budget deficits ! That's a lot of record breaking, even in record breaking times !
There is a tsunami of money slowly, but inexorably working its way through the economy. And all the Governor was saying was.....er....maybe it's time to watch and wait and see the effect of all of this stuff before doing anymore.
Let there be no doubt – all this record breaking stuff will have an effect and we will see it, albeit later rather than sooner. By which time it may be too late.
Which is why the Governor made his, almost, record breaking comments.
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