London (CNN) – From the budget, to economic benefits, to the legacy: No-one is talking about the Paralympics’ bottom line.
Perhaps it’s because Team GB and the London 2012 organization were so impressive, leaving the country revelling in the medal haul rather than totting up the bill.
The nation has gone sports-mad, now embracing the lesser-known (but I’ll bet just as exciting to watch), paralympic sports, from Murderball (think of it as wheelchair rugby) to Boccia (like bowls, but for athletes whose disabilities impact on their motor skills).
But - despite all this goodwill - the UK economy is refusing to play ball.
(CNN) – There was lively debate among Business 360 readers on question posed by Friday’s post China slowdown bigger worry than eurozone?
The heart of Friday’s post was the conversation CNN’s Richard Quest had with Jim O’Neill, chairman of asset management for Goldman Sachs, that the slowdown of developing economies such as China was more worrisome than the eurozone crisis.
Many of the dozens of comments from Business 360 readers can be summed up in two words: What slowdown?
Jon B: “I'm an American and I've been living in China for 5 years. Yes, businesses are hurting and prices are rising, but China's people are only getting richer. Their economy is doing just fine for right now. Maybe within the next five to 10 years China will resemble the U.S. and its current struggle, but for now they are full steam ahead. There aren't many icebergs big enough to cripple this boat just yet.”
Hong Kong (CNN) – Will China’s economy have a hard landing, soft touchdown or slow ascension?
The lack of strong action Thursday from the European Central Bank on Europe’s spiraling debt crisis – coupled with similar inaction from the U.S. Federal Reserve on the slowing U.S. economy earlier this week – has ratcheted global investor stress on how China will handle its own slowdown.
The question percolated throughout interviews on CNN International business shows this week.
“It is quite disturbing that Brazil and India have slowed down so much, obviously there’s this huge debate going on about China’s slowdown,” Jim O’Neill, chairman of asset management for Goldman Sachs, told Richard Quest when he argued the slowdown in developing behemoths like China and the rest of the BRIC bloc is more worrisome than the eurozone crisis.
Investor Mark Mobius, head of Templeton Emerging Markets Group, disagreed.
"A lot of people ask me if China is going to have a hard or soft landing," Mobius said. "And I say they are not landing. They're continuing to grow and they're growing at a pretty fast pace."
Still, the signs of a China slowdown are many. Inventories in factories are piling up, and companies ranging from electronics, airlines and sportswear have issued profit warnings.
“While the world fixates on what the Fed and the ECB have up their collective sleeves to stem the sovereign debt contagion and to spur growth, it appears to me that the policy prescriptions might need to include China,” wrote Mike Paulenoff of MPTrader.com. “As in, how to avert a hard landing?”
So, hard days ahead for China? Will its economy touch down gently, or is it likely to trampoline – with help from Beijing – like it did in the wake of the 2008-2009 financial crisis?
Have your say. Leave a comment below.
London (CNN) – The British economy is shrinking far faster than expected. The latest figures - showing a 0.7% contraction - are a huge shock.
The rotten weather, extra days off for the Diamond Jubilee and contagion from the eurozone crisis have contributed: Now even UK Chancellor George Osborne is conceding the country has “deep-rooted economic problems.”
Jeremy Cook, chief economist at foreign exchange company World First, points to the eurozone’s hoovering up of government cash as one issue. Government spending is meant to be dropping but is instead increasing, he says. “We’ve said the situation would get worse before it gets better, anything worse than this and we are risking depression,” he warns.
Oh dear, what a gloomy picture. But at least London is hosting the Olympics, right? British Prime Minister David Cameron has declared the games in London will bring great spoils: Around $20 billion, we’re told. Banks, restaurants and retail outlets have staffed up, helping nudge unemployment to a nine-month low.
London (CNN) – Flicking through Barclays’ 286-page annual report, it’s impossible to avoid a grinning former CEO Bob Diamond – once branded "the unacceptable face of banking" - making a range of pronouncements, which in the wake of the Libor rate fixing scandal now sound profoundly hollow.
Take this old chestnut from Diamond, much touted since banks were caught on the back foot during the 2008 credit crunch: "Banks need to become better citizens."
Or listen to this snippet: "When we’re at our best, we serve the real economy by doing our best for all our stakeholders: our customers and clients, the communities we serve, our people and our shareholders."
London (CNN) – Eurobonds will be back on the agenda at the euro crisis summit later this week, with one source telling me there will be “more than twenty different types” under discussion.
Such bonds - a way to raise cash backed by all 17 eurozone countries – have long been floated as one panacea to the bloc's financial crisis but the idea has been stymied by political resistance, largely from German chancellor Angela Merkel.
But as the crisis continues to rumble on the introduction of eurobonds looks increasingly likely. And the ascendancy of eurobond advocate Francois Hollande, France’s new president, has thrown weight behind the idea.
(CNN) - If recent history is anything to go by, the number 7 has good reason to be feared in the European bond markets.
Once yields on Greek, Irish and Portuguese 10-year notes hit that unlucky figure, they didn’t come back down - pricing three eurozone members out of the markets in quick succession and into bailout limbo.
Though it may be arbitrary, 7 could soon become the cut off point for a new two-tier common currency; an area where peripheral members pay the high price for low growth and lack of reform, whilst the more buoyant economies of the north enjoy record-low borrowing rates.
That is unless someone can convince the German Chancellor that so called jointly-issued “eurobonds” really are the panacea. FULL POST
Athens (CNN) - Greece has voted. New Democracy, its pro-bailout party, prevailed in Sunday’s election and still market reaction has been decidedly muted. Much like last week’s market performance following Spain’s aid request, the euphoria fizzled quickly as traders focused instead on the considerable unknowns looming in the distance.
Among the unanswered questions: Will Greece’s New Democracy party be able to form a government? And how much leeway will it have to soften the terms of its Troika-prescribed austerity package?
Writing to clients today, HSBC economists David Bloom and Janet Henry said Greece’s result may offer temporary relief but warned that “major challenges remain.”
“While a coalition of pro-bailout parties would put the idea of a Greek euro exit on the back burner for now, it would not alter the underlying problems in the euro zone itself,” they added. FULL POST
London (CNN) – For London’s investment community Sundays are more about talking pizzas than politics.
They’re the last chance to unwind before buckling up for the bumpy ride when the markets open on Monday morning.
But across Europe’s financial hub, traders are keeping an uneasy eye on events in Athens and preparing themselves for what many reckon will be a wild week at work.
The 43 year-old Dutchman shot to fame three years ago at the height of the credit crunch as the forthright financier on the BBC’s reality show "Million Dollar Traders."
Van Dam now spends his time running Hampstead Capital, a fund with 500 million euros ($630 million) under management, as well as his new initiative: The Lex van Dam Trading Academy, set up to teach would-be dealers how to manage money.
He took time away from his weekend lunch (and 26,000 followers on twitter) to answer five key questions on what the Greek elections mean for the markets.
1. Will Greece leave the euro?
Yes. They will leave very soon unless the Germans change their tune and throw more money at them. It is slightly unfair though as most of the help Europe gives them is to help the Europeans themselves as opposed to helping the Greek people.
2. Is austerity the right answer?
Austerity is not the answer. The Greek economy is absolutely collapsing and the tax base is going down with it. The American and British solution of printing money is not the answer because it will lead to a total lack of trust in the government because paper money will be worthless. The answer is accepting that people in the West need to work harder and longer.
3. Will the euro survive?
The biggest chance is for a two-speed Europe to emerge with Germany leading the euro pact and Italy in the second group. The German euro will be very strong, the Italian euro very weak though.
4. Eurobonds: The perfect cure or recipe for disaster?
The Germans have done a massive amount of austerity at home with a higher retirement age and lower wage inflation than in the southern European nations. They will not write a blank cheque to the south. Eurobonds mean that the Germans will become responsible for the Greek debt. It will not happen unless countries such as Spain and Italy give up part of their sovereignty.
5. Where are you putting your money now?
My money stays in cash and real assets such as property and gold. Shares are not expensive right now but if interest rates go up even a little they could drop a lot.
Athens (CNN) - Whichever way the Greek people vote in these elections, there are no easy options for the country. It is almost certain no one party will get a majority – even with the top-up seats given to the front runner.
We are facing days of horse-trading.
The best that can be hoped for is that the leaders of New Democracy and PASOK follow through on the noises they are making. That it is time for unity.
They know what that means. That they are going to have to get into coalition with each other. If they do that, Greece carries on.
However, even if these so-called “sensible parties” get into bed with each other, they will still want to renegotiate the deal with Europe.
Europe will not budge on issues such social security, pensions or privatizations. But they might be willing to talk on deficit targets and taxation levels, for example, given the difficulties created by the recession.
There are 1,001 ways that Greece can stay in the euro. But even if the austerity deal is renegotiated, the Greek people face another three to five years of pain.
About Business 360
CNN International's business anchors and correspondents get to grips with the issues affecting world business, and they want your questions and feedback.