スポットＣＭ不振 ＴＢＳも役員報酬カット
2008年7月9日20時5分
ＴＢＳの井上弘社長は９日の定例記者会見で、７月から０９年６月まで社外取締役を除く常勤役員１８人（ＴＢＳテレビ含む）の報酬を一部返上することを明らかにした。４～６月は、番組の前後に流すスポットＣＭの営業収入が不振だったため。
井上社長が月額報酬の１５％、代表権を持つ専務２人が１２％、残りの役員１５人は１０％カットする。原油高などで企業収益が圧迫されてＣＭ出稿量が落ち込む一方、インターネットの広がりでメディア間の競争は激しさを増している。民放各局はＣＭの営業で苦戦。キー局ではテレビ朝日、テレビ東京が役員報酬のカットを打ち出している。
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Four Russian missile carriers patrolling Arctic, Atlantic oceans
09.07.2008, 11.01
MOSCOW, July 9 (Itar-Tass) - Four strategic missile carriers Tu-95MS (NATO reporting name Bear) went on a flight in the small hours on Wednesday to patrol the Artic Ocean and the Atlantic Ocean, acting chief press officer of the Russian Air Force Lieutenant-Colonel Vladimir Drik told Itar-Tass on Wednesday.
“Four strategic missile carriers Tu-95MS took off from the Ukrainka airbase in the Amur region overnight to July 9 and are on a 14-hour patrolling mission over the Arctic Ocean and the Atlantic Ocean,” the spokesman for the Russian Air Force said. “Two fuel tankers Il-78, which flied from the Dyagilevo airbase in Ryazan, performed the air refueling of the missile carriers on Wednesday morning,” he said. He noted that “NATO fighters are escorting the strategic missile carriers during the patrolling mission.”
Drik recalled that “pilots of the Russian long-range aviation make regular patrolling flights over the neutral waters of the Arctic Ocean, the Atlantic Ocean, the Black Sea and the Pacific Ocean from basic and operative aerodromes.” “After the patrolling mission the missile carriers Tu-95MS will return to the basic aerodrome,” the spokesman said.
“Russian planes made and make all flights in the strict compliance with the flying international rules over the neutral waters not transgressing the borders of other countries,” he recalled.
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Russia to submit claim to Arctic shelf to UN by 2009
15:22 | 08/ 07/ 2008
ST. PETERSBURG, July 8 (RIA Novosti) - Russia is preparing an application to the UN in order to gain the right to widen the country's territorial borders in the Arctic, a Russian lawmaker said on Tuesday.
Artur Chilingarov, a member of the lower house of Russia's parliament and a veteran explorer, said that by 2009 Russia would submit documentary substantiation of the external boundaries of the Russian Federation's territorial shelf to the UN.
"Taking into account the result of the 2007 expedition, we are preparing to submit an application by 2009," he said. "Everything is based on international law and obligations."
Last August, as part of a scientific expedition, two Russian mini-subs made a symbolic eight-hour dive beneath the North Pole to bolster the country's claim that the Arctic's Lomonosov Ridge lies in the country's economic zone. A titanium Russian flag was also planted on the seabed.
Russia's 2007 expedition irritated a number of Western countries, particularly Canada, and Peter MacKay, the Canadian foreign minister, accused Moscow of making an unsubstantiated claim to the area.
Russia's oceanology research institute has undertaken two Arctic expeditions - to the Mendeleyev underwater chain in 2005 and to the Lomonosov ridge last summer - to back Russian claims to the region.
The area is believed to contain vast oil and gas reserves and other mineral riches, likely to become accessible in future decades due to man-made global warming.
Researchers have conducted deepwater seismic probes, aerial and geophysical surveys, and seismic-acoustic probes from the Akademik Fedorov and Rossiya icebreakers.
Russia first claimed the territory in 2001, but the UN demanded more evidence.
Under international law, the five Arctic Circle countries - the U.S., Canada, Denmark, Norway and Russia - each have a 322-kilometer (200-mile) economic zone in the Arctic Ocean.
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Exercise of Pacific Fleet begins in Sea of Japan
08.07.2008, 10.17
VLADIVOSTOK, July 8 (Itar-Tass) -- An exercise of the Pacific Fleet (PF) holding the Order of the Red Banner has begun in the Sea of Japan on Tuesday. More than 20 ships and support vessels take part in them.
As ITAR-TASS learnt at the PF information and public relations service, a special part at this exercise is assigned to missile carriers. According to the exercise plan, striking groups consisting of the missile carrier Varyag, the destroyer Bystry, as well as crews of a squadron of torpedo boats are to detect a supposed landing of troops. Big antisubmarine ships, which are to secretly come up to our shores, will play their role, patrol aviation will prevent them from doing this.
During the exercise, about 20 different individual and group combat exercises are to be fulfilled. Ship crews will hold individual and group firings on ground, surface and air targets with the use of artillery of universal calibre. Anti-sabotage actions of crews will be drilled, and mine-sweeping ships are to carry out different kinds of training sweeping. Group firing of Varyag and Bystry at air targets with the use of anti-aircraft missile complexes will be the culmination of this exercise.
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Kyrgyzstan to supply 18,000 t of cotton to Russia
07.07.2008, 13.15
BISHKEK, July 7 (Itar-Tass) -- Kyrgyzstan will supply 18,000 tonnes of cotton to Russia in 2008. As ITAR-TASS learnt at the press service of the Kyrgyz head of state, it was announced on Monday, during a meeting of President Kurmanbek Bakiyev of Kyrgyzstan with head of the Federal State Reserves Agency of Russia Alexander Grigoryev.
According to Grigoryev, at present, the sides also study the possibility of supplying other kinds of agricultural produce to Russia from Kyrgyzstan. Besides, the Russian side studies the issue of organizing qualification-raising courses for specialists in state material reserves from Kyrgyzstan.
Grigoryev arrived in Bishkek to participate in a regular meeting of the consultative State Reserves Council of the CIS member-countries.
According to the official information, over the last two years, trade turnover between Kyrgyzstan and Russia considerably increased and in 2007, it for the first time exceeded the level of one billion dollars.
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Russia must punish states hosting U.S. missile shield - analyst
17:32 | 09/ 07/ 2008
MOSCOW, July 9 (RIA Novosti) - Russia must use economic and political means, and military ties with Asia, to punish European states that agree to host U.S. missile defense elements, a Russian political analyst said on Wednesday.
Commenting on a U.S.-Czech deal signed on Tuesday on deploying a missile tracking radar, Col. Gen. Leonid Ivashov, the head of the Moscow-based Academy of Geopolitical Sciences, said: "Russia should not limit itself to statements. We must have a plan, adopted by the Russian Security Council, setting out measures on the economic, political and military cooperation levels."
Moscow has strongly opposed the possible deployment by the U.S. of 10 interceptor missiles in Poland and an accompanying radar in the Czech Republic as a threat to its security and international nuclear deterrence. Washington says the defenses are needed to deter a possible strike from Iran.
The U.S.-Czech missile shield treaty has yet to be ratified by the Czech parliament and signed by the Czech president. The country's opposition is currently holding mass rallies around the country against the placement of an early warning radar near the capital, Prague.
Polish-American talks on Washington's plans to place a missile base in Poland have stalled. Poland's prime minister said last Friday that his country was not satisfied with the terms offered by the U.S., but was ready for further dialogue.
Ivashov, who headed the main directorate for military cooperation at the Russian Defense Ministry in 1996-2001, told RIA Novosti: "On the political level, we must suspend our cooperation with NATO, because it brings us nothing but harm."
As an alternative, he suggested that Russia start negotiations with China, India and other countries to form a global alliance against the U.S. missile shield in Europe.
"A relevant decision must be made, at least in the framework of the Collective Security Treaty Organization (CSTO)," Ivashov said.
The CSTO is a regional security organization comprising Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia, Tajikistan and Uzbekistan.
On the economic level, Russia must restrict imports and exports from and to countries which allow the placement of U.S. missile defense systems on their territory.
"Bilateral relations with these countries as a whole must be limited," Ivashov said.
"Russia must also warn the European countries that... in case of a potential military confrontation... capitals, large cities, and industrial and communications centers of the countries hosting elements of the U.S. missile shield will inevitably become primary targets of nuclear strikes," the general said.
"They should know that we are holding them in our sights," he added.
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Russian arms exports to pass $6 bln in 2008
14:48 | 09/ 07/ 2008
MOSCOW, July 9 (RIA Novosti) - Russia's arms exports are expected to exceed $6 bln this year, the chief executive of the state-run arms exporter Rosoboronexport said Wednesday.
In an interview with the Rossiiskaya Gazeta daily, Anatoly Isaikin said Russia's arms exports grew from less than $3 billion in 2000 to $6.1 billion in 2007.
"I believe that in 2008 we will exceed last year's level," he said.
Rosoboronexport puts the global arms market at $45-50 bln a year.
The Russian arms exporter has around $20 bln worth of contracts, which will ensure the operation of defense-industry enterprises for the next five to seven years.
Isaikin said Russia is encountering fierce competition in the international arms market.
Russia exports weapons to about 80 countries. Among key buyers of Russian-made weaponry are China, India, Algeria, Venezuela, Iran, Malaysia and Serbia.
The most popular types of weaponry bought from Russia are Sukhoi and MiG fighters, helicopters, battle tanks, armored personnel carriers and infantry fighting vehicles.
Russia also maintains traditionally strong positions in sales of small arms, and anti-tank and air-defense missile systems.
The United States has repeatedly called on Russia to stop arms deliveries to countries whose political regimes Washington disapproves of, including Iran and Syria.
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Ahmadinejad on his way out?
20:45 | 08/ 07/ 2008
MOSCOW. (Political scientist Ilgar Velizade for RIA Novosti) - One year from now Iran will hold presidential elections. Political changes are not frequent in that country, but each of them is invariably associated with the major political event of a five-year period.
This time that applies to a recent article in the Italian newspaper La Repubblica. It was written by one of the most influential Iranian politicians, Ali Akbar Velayati, who served as Iran's foreign minister for almost 17 years. Although Velayati has not played a prominent political role in the last few years, he has retained his political influence as a diplomatic advisor to Ayatollah Ali Khamenei, Iran's supreme religious leader.
In his article, Velayati writes that from now on Khamenei will himself conduct talks on the nuclear program. In other words, he has relieved Mahmoud Ahmadinejad of this responsibility. Velyati says the Iranian leader's decision was prompted by the need to search for compromise over Iran's nuclear program.
Velayati makes it clear that Iran is fully prepared to revise the main provisions of the president's foreign policy. He quoted Khamenei as saying that global peace rests on the recognition of sovereignty and respect for international borders. This is a clear indication that Khamenei is not going to "erase Israel from the face of the Earth." He believes that the "political future of major countries in the region should be decided at democratic elections, and that their results should be accepted and respected if Muslims, Jews, and Christians take part in them as free citizens."
Many analysts believe that this statement confirms Tehran's official position on recognition of Israel, formulated by former President Mohammad Khatami. That position essentially says that if Palestinians vote for a peace treaty based on a two state solution, Iran will join the Palestinians and, hence, may recognize Israel.
Although Khamenei's decision to assume responsibility for foreign policy is surprising at first sight, there are several possible explanations.
First, Iran is preparing the ground for dialogue with the new U.S. president, and wants to start from a blank slate on all key problems. In this way, Tehran may gain time to make a breakthrough in its nuclear program while simultaneously reducing tensions with Israel.
Second, the Iranian leader has launched preparations for next year's presidential elections. He has got his timing right (the polls are twelve months away), and by choosing one of the most prominent aspects of Ahmadinejad's policy he has deprived the president of a considerable part of his powers.
Who will replace Ahmadinejad, and will the successor continue his mission? These questions are becoming increasingly urgent.
Several figures who represented Iran in the world arena several years ago have reemerged on the domestic political scene. One of them is Ahmadinejad's old associate Ali Larijani, former secretary of the Supreme National Security Council. Once Iran's chief nuclear negotiator, he had to leave Ahmadinejad's team because of disagreements with his former boss. When the results of parliamentary elections were counted in Iran last spring, bets were placed on Larijani, who positioned himself as a neo-conservative. He was supposed to help if the ruling regime started losing popularity before the presidential elections.
Now that scenario seems to be unfolding. Though it is notoriously difficult to draw direct parallels in Iran, Larijani, who is already the speaker of parliament, is likely to play an increasingly important role.
Whatever else, it is clear that Ahmadinejad is gradually losing influence on the world stage. Time will show whether he will leave the political scene altogether.
The opinions expressed in this article are the author's and do not necessarily represent those of RIA Novosti.
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Russia's uranium breakthrough
20:07 | 08/ 07/ 2008
MOSCOW. (RIA Novosti commentator Tatyana Sinitsyna) - Russia has overtaken Niger to become the world's fourth largest uranium producer, after Canada, Australia, and Kazakhstan. Russia received its new rating in 2007, when it produced 3,527 tons of uranium.
It has ambitious plans to mover even further up the league, based on promising deposits in Eastern Siberia and other regions, and opportunities for mutually advantageous cooperation with countries rich in uranium ore.
Today, the uranium market is very busy and full of optimism. It is characterized by a high-level of monopolization - three quarters of all uranium is produced by five countries. Having placed its stake on nuclear energy, Russia has left itself no choice but to replenish its uranium reserves under a clear-cut and rational program.
In 2006, Russia launched cooperation with Kazakhstan. It owns 49% of shares in the Zarechnoye Joint Venture (JV), which is in charge of a 19,000-ton uranium deposit. Last year, Russia signed a bilateral agreement with Australia, which will supply it with one million dollars worth of uranium for civilian purposes every year.
Also last year, Russia set up joint ventures with Canada's Cameco Corporation to undertake uranium prospecting and extraction in both countries. Potential for uranium production has also been assessed in Armenia; and Russia and Armenia have signed an agreement on uranium prospecting and production.
Mongolia may also occupy a major place in the global nuclear industry. In theory, its uranium resources are the biggest in the world, and it only remains to explore and produce them.
Russia's state-owned nuclear energy corporation, Rosatom, will have to work hard to guarantee the steady growth of its nuclear industry. Expansion is encouraged by uranium prices that are growing even faster than those for oil and gold.
The world is not short of uranium. On the contrary, nature has preordained a future atomic renaissance. Experts believe that there are billions of tons of uranium ore in the entrails of the earth - much more than silver or mercury. It was the nuclear industry that stood behind the dazzling career of the modest 92nd element in Mendeleyev's Periodic Table, having invented technologies that release enormous amounts of energy from it. Against the background of the global energy crisis, this soft, silver-white metal has become highly precious. One cubic centimeter of uranium is equivalent to 60,000 liters of gasoline, 110-160 tons of coal, or almost 60,000 cubic meters of natural gas.
The Priargun mining and dressing plant in the city of Krasnokamensk in the Chita Region in Russia's Far East produces 93% of Russia's uranium. The deposit's proven reserves are estimated at 150,000 tons, with 2,500-3,000 tons mined annually using expensive conventional methods. Another seven percent are extracted more cheaply by underground leaching in the Kurgan Region (Dalur), and the Republic of Buryatia (Khiagda). These deposits are enough to meet the national demand for uranium, but this is about it.
Meanwhile, Russia has to supply uranium to nuclear power plants that were built abroad in Soviet times, and it also has export contracts for uranium enrichment and processing. If we take into account all these factors, the gap between demand and supply adds up to 6,000 tons a year. Russia currently makes up for the shortfall with uranium from "secondary reserves" - depots of fissionable materials, converted nuclear weapons, and so-called "depleted uranium tails" (uranium ore used twice). But these secondary reserves, which every nuclear power has stockpiled since the start of the nuclear era, are disappearing fast. They will last no more than 10 or 15 years.
Aware of the situation, Russia is building up its uranium ore production. The process is carried out by Rosatom's uranium monopoly, Atomredmetzoloto. This year, the company plans to produce 3,880 tons of uranium, bringing its extraction to 20,000 tons by 2024.
Russia has some 564,000 tons of proven uranium reserves, including its biggest deposit at Elkon (344,000 tons) on the shores of the Aldan River in the north of Republic of Sakha (Yakutia). This deposit is hard to access; it is located in permafrost, and the ore lies deep. But the requirements of the nuclear Renaissance are tough and call for extreme efforts. Russia wants to extract no less than 5,000 tons of uranium from the Elkon deposit by 2020. At the same time, it is planning to increase uranium production at its joint ventures in Kazakhstan.
Experts believe that Russia's total uranium potential (natural and weapons-grade) will enable it to enrich 45% of the world's uranium for nuclear power plants by the year 2030.
The opinions expressed in this article are the author's and do not necessarily represent those of RIA Novosti.
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Won makes biggest jump for a decade
By Neil Dennis
Published: July 9 2008 10:11 | Last updated: July 9 2008 17:36
The South Korean won had its biggest daily jump in more than a decade on Wednesday as monetary authorities intervened in the foreign exchange markets to stop the weak currency from further fuelling inflation.
Traders estimated the Bank of Korea had sold more than $3bn on Wednesday, in addition to about $2bn on Tuesday, to prop up the won, which fell 10 per cent in the first six months of the year.
By midday in New York, the dollar was down 2.4 per cent to Won999.00, having fallen as low as Won994.75 – its best level since April 29.
Signs that the Bank had intervened on Tuesday lifted the Korean currency more than 1 per cent and prompted a statement from the finance ministry, saying it would use foreign exchange reserves again if necessary to help stabilise inflation. Meanwhile, the central bank suggested it would continue to defend the currency at Won1,000.
“Government acknowledgement that it may take firmer action than the FX market thinks, suggests that there is further to run in this story,” said Dwyfor Evans at State Street.
“Foreign reserves to the tune of $258bn suggest ample ammunition to support the won irrespective of a fundamental reading of the economy.”
Elsewhere, the Australian dollar fell to a three-week low of $0.9477 against the dollar after weak consumer confidence and home loans data hit the currency.
Australian home loan approvals fell by the most in eight years in May, while the Westpac consumer confidence index fell to its lowest level since 1992.
However, the Aussie recovered some poise later in the session to stand up 0.2 per cent at $0.9560 as the dollar came under pressure.
Analysts said a rise in oil prices triggered by reports that Iran had test-fired missiles weighed on the dollar.
The fact that the communiqué following the G8 meeting of the leaders of the world’s richest nations failed to address the dollar’s weakness also encouraged selling.
The dollar fell 0.3 per cent to $1.5726 against the euro, lost 0.4 per cent to $1.9778 against the pound and eased 0.3 per cent to Y107.10 against the yen.
The Canadian dollar advanced more strongly, rising 0.7 per cent to C$1.0116 against the dollar after Canadian housing starts fell less than expected, easing fears that the sector was set to mirror the collapse in the US.
Elsewhere, the Israeli shekel rose 1.6 per cent to a fresh 11½-year high of Shk3.2143 against the dollar, shrugging off rising tensions in the region.
Analysts said the rise reflected the resilience of the Israeli economy, where exports are still rising more than 17 per cent a year, and the prospect that the country’s central bank would raise interest rates this month.
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Hedging on new currency options
By Peter Garnham
Published: July 9 2008 16:40 | Last updated: July 9 2008 16:40
Trading in currency options has exploded in recent years, echoing the rampant growth in foreign exchange as an asset class.
This trend, driven principally by increasing interest in currencies from hedge funds, has led to an 81 per cent jump in daily turnover of currency options to an average of $200bn in the three years to 2007, according to the latest survey from the Bank for International Settlements.
Until now, foreign exchange options have been based largely on swings on the world’s currency markets.
But this is about to change with the emergence of a new generation of foreign exchange options products which allow investors to trade across asset classes.
This means that currency trades are going to be more dependent on movements in other markets, such as interest rates, commodities and equities.
“This is going to be the next big thing,” says David Gershon, chief executive of Superderivatives, the London-based technology firm that provides independent valuations of derivatives across a wide range of assets.
The evolution is a natural step for the FX options markets, which has been at the cutting edge of derivative innovation over the past three decades.
Back in the 1980s, foreign exchange options were relatively simple. So-called plain vanilla options valued the right to buy or sell a given currency against another at different prices and at different dates in the future.
Although relatively simple products by today’s standard’s, expertise was thin on the ground, allowing a few large banks to extract healthy margins from customers and the market.
However, as familiarity with these products grew, margins were squeezed and within a few years banks were looking for alternative sources of higher margins. From here, the so-called first generation of currency options was spawned.
The first generation allowed investors to put conditions on plain vanilla options. For example, by adding so-called “knock-ins” and “knock-outs”, options contracts were either activated or de-activated depending on whether certain currency levels were achieved.
The second generation of FX options combined these first generation products into packages with delayed starts, creating such structures as “window options” in which a customer’s right to buy or sell a currency only existed for a certain period of time.
Next came the third generation, which generated even more complex structures, which combined different option packages to enhance yield.
Now, the FX options markets are moving towards the fourth generation, with investors demanding structures that link different asset classes.
Currencies of commodity producing countries such as Australia have been highly correlated with the price of raw materials in recent years. For instance, the Norwegian krone and the price of oil are highly correlated while the Japanese yen has displayed a remarkable inverse relationship with equities. Meanwhile, the path of global interest rates has long been a driver of currency movements.
By taking advantage of these linkages, investors can create option structures that have the potential to enhance yields.
Such structures – which could, for example, include an investor’s right to sell the yen if the Nikkei 225 stock index hits a certain level – are far more complex to build than single asset options.
But investors such as hedge funds are becoming more and more comfortable dealing with the increased complexity of such cross asset structures, driven in part by the emergence of web-based pricing platforms such as that provided by Superderivatives. This has increased transparency in the market, which in turn has boosted volumes.
Mr Gershon says while the market for these products may not have taken off yet, it is just a matter of time before they become more mainstream.
“If you are a Norwegian oil exporter, you are going to do one trade, that includes the Norwegian krone and Brent oil,” he says. “The world is going to change and people are going to hedge their foreign exchange exposure in one structure. It will cut transaction costs dramatically.”
Such a development, which could reinforce the correlation between different financial asset classes, may well ring alarm bells in the offices of the world’s central banks. Policymakers are concerned about the way in which the unwinding of complex debt instruments has fed through to many asset classes and markets around the world.
However, bankers say they want to avoid the arms race of complexity that developed in the credit markets and left banks with a huge amount of risk on their books.
“We steer our product developers away from an exercise in complexity for its own sake,” says Troy Rohrbaugh, head of global FX trading at JPMorgan.
He says that while banks have to develop new option products to stay competitive, they have to be products that clients want and are willing to trade.
“If you create a product that can’t be hedged properly, you may potentially create an issue,” says Mr Rohrbaugh. “Risk management advances and better liquidity in foreign exchange make it less likely that what happened in other markets will happen in FX. However, given the current market dynamics, this possibility cannot be categorically ruled out.”
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View of the day: Commodity currencies
By Hans Redeker
Published: July 9 2008 15:43 | Last updated: July 9 2008 15:43
Commodity currencies such as the Australian and New Zealand dollars are coming under pressure, despite weathering the early stages of the global slowdown and credit crunch extremely well, says Hans Redeker, global head of FX strategy at BNP Paribas.
He notes that the Reserve Bank of Australia has acknowledged that the country’s economy is feeling the negative effects of the global credit crunch and that a recent NZ Treasury report suggests that the New Zealand economy is already in a recession.
“Hence, we believe that the interest rate cycles in NZ and Australia have now peaked,” Mr Redeker says.
But he also points out that it has been the international investment environment that has been the main driving force for the Australian and NZ dollars over the past few years, and that this is also deteriorating.
“Hopes of an emerging market decoupling have evaporated, with fears of stagflation now gripping the Asian regional markets,” Mr Redeker says. “Moreover, the fears of a global slowdown are also starting to have an impact on commodity prices - with the current exception of oil.
“There are clear signs that the major Australian dollar/US dollar uptrend is running out of steam. It is also interesting to note that there has been a sharp scaling back of speculative Australian dollar long positions from their recent peak over the course of the past few weeks, according to the CFTC position data.”
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View of the day: Dollar and inflation
By Simon Derrick
Published: July 8 2008 15:44 | Last updated: July 8 2008 15:44
What will it take to reverse the dollar’s six-and-a-half year downtrend? asks Simon Derrick, strategist at Bank of New York Mellon.
He believes that in the absence of a dramatic recovery in the US economy, which would allow the Federal Reserve to raise interest rates aggressively, the best chance may come from a sudden abatement of global inflationary pressures.
“Such a shift would presumably see investors turn from seeking out currencies with the most hawkish central banks to favouring those with the most growth-oriented policy stance,” he says. “In this situation, the dollar should be a natural winner.”
However, with Nymex crude oil up more than 100 per cent year-on-year, and the CRB commodities index up nearly 50 per cent over the same period, there appears to be little to cheer about, Mr Derrick says.
But he says there are some interesting signs for those looking for an easing of price pressures.
He points to marked reversals in a number of basic foodstuffs, including rice and wheat, and a sharp drop in the Baltic Dry index, a measure of commodity shipping costs. Mr Derrick also notes that gold, normally a reliable indicator of inflation concerns, remains well below its mid-March levels.
“All of this remains just tentative evidence that inflationary pressures may start to abate from here. However, with oil stumbling in the past 24 hours, perhaps now is the time to start looking for more evidence.”
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Investors must be wary of the US inflation bandwagon
By Richard Bernstein
Published: July 9 2008 17:12 | Last updated: July 9 2008 17:12
There is no doubt US headline inflation has moved higher, and is likely to continue to do so in the near-term. However, investors should look beyond the current discussions regarding pricing pressures. The financial markets already appear to be doing so.
In the next several months, there is a very good chance that the US headline inflation rate will be about 6 per cent, which hasn’t happened since December 1990. We think this will be a temporary development, though it is something to be aware of. We believe headline inflation in the US will fall to 4 – 5 per cent by year-end and to 3 per cent or lower in 12 months.
Expectations are often set by personal experience. Currently, many “high frequency” items, such as gasoline and food, are indeed experiencing significant inflation in the US. Because these items are frequently purchased, the overall impression might be that all prices are rising. However, other goods that are less frequently purchased are experiencing significant deflation. IT goods and TVs would be two examples.
We find it curious that investors are paying so much attention to US inflation because it is a notorious lagging indicator. Financial theory teaches us that financial markets lead or forecast the economy, yet both unit labour costs and the services consumer price index are members of the Conference Board’s US Lagging Index.
Monetarists generally argue that it is difficult to get inflation without a credit expansion. Today’s inflation might, therefore, be the lingering effect of yesterday’s credit bubble. Credit conditions continue to tighten, which suggests to us that future US inflation will be more benign than investors currently expect.
Cost-push, commodity inflation doesn’t last if there is nothing to push. Growing excess capacity in both labour and producing markets is apparently causing commodity inflation to act more as a tax to slow economic growth than as a stimulant to future US inflation. Margin squeeze is increasingly being cited as the cause for earnings disappointments. Input prices may be going up, but it is getting tougher to pass on those rising costs.
Some investors believe the Fed is losing the battle against rising inflation expectations. But “Money Market Vigilantes” (as opposed to the old “Bond Market Vigilantes”) seem to be stepping in where the Fed fears to tread. The 3-month London Interbank Offered Rate/T-Bill spread, or the “TED” spread, widened by about 25 basis points during June. So, whether the Fed wanted to tighten or not may have been a moot point because actual inter-bank borrowing costs went up by 25 basis points.
If financial markets are indeed leading indicators, then there are some very clear indications that investors should not be structuring their portfolios for inflation. This year, treasuries have outperformed the S&P 500, developed market sovereign debt has outperformed developed market equities, and emerging market sovereign debt has outperformed emerging market equities.
If inflation were tomorrow’s investment story we believe it is unlikely this would be the case. Inflation is historically the notorious kryptonite of fixed-income investments, yet bonds are nonetheless outperforming equities.
One might argue that the bond markets are poised for severe disappointment, but our contrarian instincts lead us to believe that might not be the case. In the latest Merrill Lynch Fund Manager Survey, not one of the hundreds of portfolio managers taking part in the survey thought that long-term interest rates would be lower one year hence. History shows quite clearly that such strong unanimity rarely turns out to be correct, so investors might still be too bearish on bonds.
Investors may again be chasing a mature story with the maximum attention coming right at the peak of asset prices. In 2002, deflation strategies in the US were the rage despite commodity prices troughing. We think investors should be equally wary of jumping on today’s US inflation bandwagon. Contrarian strategies based on slowing growth, such as high quality bonds and defensive equity sectors, seem to provide better investment opportunities.
The writer and co-author David Rosenberg are chief investment strategist and chief north American economist respectively at Merrill Lynch
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Berlin set to curb executive payments
By Bertrand Benoit in Berlin
Published: July 9 2008 23:36 | Last updated: July 9 2008 23:36
The German government is poised to crack down on excessive executive pay before the end of the year in a move that could curtail the use of stock options to reward directors based in the country.
The Christian Democratic Union of Chancellor Angela Merkel has set up a working group that will start work in September on concrete proposals. These are likely to include a tightening of corporate governance rules and corporate taxation.
The proposals, to be finalised in the autumn, are likely to make it into law since both parties in the fractious grand coalition have agreed to act. The Social Democratic party has already filed its own suggestions and the move by the CDU shows it has overcome misgivings about cracking down on inflated boardroom pay packages.
Unlike the SPD, the CDU said it would not just focus on executive and supervisory board members but also tackle big compensation packages for entertainers at public sector broadcasters.
The disclosure some months ago that Wendelin Wiedeking, chief executive of carmaker Porsche, had earned €60m ($94m, £48m) in the past fiscal year sparked uproar among the public at a time of rising concern about inflation and stagnating purchasing power.
The compensation of directors at blue-chip companies has risen seven-fold since 1987 while employees and executives of private companies saw their pay double, according to a study last month by Kienbaum, a German consultancy.
The compensation explosion, Kienbaum said, was largely due to the adoption of performance-related packages. Chief executives of large exchange-listed companies now earn on average 100 to 200 times the average salaries in their companies.
Otto Bernhardt, the CDU member of parliament who will head the party’s working group, said it would therefore focus on the treatment of stock options as a priority. One scenario would be to force managers to exercise their options after a minimum of four years instead of two currently.
“We are seriously concerned about stock options and I think we may even ask whether they can really be considered an acceptable means of payment,” Mr Bernhardt said.
He said the CDU was sympathetic to a SPD proposal that would force executive boards to vote on individual directors’ pay packages and prevent the decision being delegated to a smaller compensation committee.
The CDU is more reserved about a suggestion by the SPD to review the tax treatment of directors’ packages, which are now considered costs and can be deducted from a company’s tax bill.
“The experience of the US shows such legislation has actually increased compensation by encouraging companies to raise the proportion of variable pay for managers,” Mr Bernhardt said.
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Iran test-fires missile in the Gulf
By Najmeh Bozorgmehr in Tehran
Published: July 9 2008 11:42 | Last updated: July 9 2008 17:51
Iran test-fired ballistic missiles on Wednesday in an exercise officials said was designed to show how the country could retaliate against a US or Israeli attack, state television reported.
The test – by Iran’s elite Revolutionary Guard – came amid escalating international tensions over the country’s nuclear programme. There has been speculation in recent weeks that Israel could mount an attack on Iranian nuclear facilities.
Suspicions were fuelled by recent Israeli military manoeuvres in the Mediterranean, which some US officials described as target practice for an Iran strike.
The aim of the test was to prepare “for a quick and crushing response and retaliatory blows in the event of an enemy attack”, said Mohammad-Ali Jafari, chief commander of the Revolutionary Guard, before the missiles were fired.
Iran’s state TV showed footage of the test in which at least seven medium and long-range missiles, including a Shahab-3 were fired in a desert area at 8am local time. The domestic media reported that the Shahab-3 was an upgraded missile.
The US urged Iran to halt development of ballistic missiles and stop tests if it want- ed “to gain the trust of the world”. Gordon Johndroe, White House spokesman, said in Japan, where President George W. Bush was at the Group of Eight leading industrial nations summit, that Iran “should stop the development of ballistic missiles, which could be used as a delivery vehicle for a potential nuclear weapon, immediately”.
The launch also drew a swift response from both the presidential hopefuls. Republican John McCain called for the establishment of a missile defence shield in Europe – opposed by Russia – to counter Iranian ambitions. The tests “demonstrate the need for effective missile defence now and in the future, and this includes missile defence in Europe as is planned with the Czech Republic and Poland,” he said.
His Democratic rival, Barack Obama, called for harsher measures after the tests. “Iran is a great threat. We have to make sure we are working with our allies to apply tightened pressure on Iran,” he declared.
Oil prices initially rose on news of the tests but eased in later trading.
News of Iran’s missile test came as the G8 expressed “serious concern” over Iran’s failure to comply with UN Security Council resolutions calling for Tehran to suspend all enrichment-related activities. Last month, six global powers offered a package of economic incentives to Iran if it halted nuclear activities. A formal response has not been made public, but Javier Solana, European Union foreign policy chief, is due to travel to Tehran – perhaps as early as next week – to discuss the offer.
“President Bush and our partners in the United Nations Security Council, as well as Germany, are committed to a diplomatic path, and have offered Iran a generous package of incentives if they will suspend their uranium-enrichment activities,” said Mr Johndroe.
Iran insists its nuclear programme is a purely peaceful.
Bank loses court case
A London-based subsidiary of Iran’s largest commercial bank, Bank Melli, failed on Wednesday in a High Court bid for the right to continue trading despite EU anti-nuclear sanctions. Lawyers for Melli Bank Plc had argued that, because it was strictly regulated by the Financial Services Authority and legally and functionally distinct from Bank Melli, it should not be prevented from carrying on business by the “catastrophic’’ effects of the restrictions imposed on its parent. But two judges ruled that, because the issue was to be considered by Europe’s Court of First Instance within the next few days, the English court should not take “pre-emptive’’ action.
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UK outsourcing to private sector doubles
By Nicholas Timmins, Public Policy Editor
Published: July 9 2008 23:33 | Last updated: July 9 2008 23:33
Outsourcing of public services to the private and voluntary sectors has almost doubled to close to £80bn in little more than a decade and makes up a far larger part of the economy than previously thought.
A government-sponsored study by DeAnne Julius, the economist, revealed on Thursday that those sectors supply a third of public services – everything from National Health Service treatments to bin emptying, IT, back-office functions and RAF pilot training.
The market is worth £79bn, employs almost as many people as the NHS and accounts for 6 per cent of gross domestic product, making it a larger industrial sector than pharmaceuticals, automotive or electricity, gas and water. It also has considerable potential for further growth both at home and abroad, the study is expected to conclude.
John Hutton, the business secretary who commissioned the report, is set to lead a first public service industry trade mission to Washington next week to promote its export potential.
“UK companies and the services they deliver are of increasing global interest in this growth market,” said Mr Hutton. “As policymaker, procurer and provider, we... must do all we can to help UK companies prosper at home and in these new overseas markets.”
Previous estimates of the size of the public services industry suggested about a fifth of public services were delivered by the private and voluntary sectors.
The study, which has disaggregated government accounts to get to the answer, shows it to be far larger. In real terms, it has grown from revenues of £42bn in 1995-6 to £79bn last year.
Growth has slowed, however, running at 3 per cent a year real after 2003-04, against 7 per cent real in the preceding period. The prime minister has said the private sector role will grow “at an increasing pace” where it offers value for money.
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Trichet steps up inflation warnings
By Ralph Atkins in Frankfurt
Published: July 9 2008 09:38 | Last updated: July 9 2008 18:27
Jean-Claude Trichet, European Central Bank president, sounded the alarm on Wednesday over the spill-over effects of soaring oil prices, saying “first signs” were emerging that inflation dangers had spread into eurozone labour markets.
Mr Trichet’s comments in the European Parliament highlight the ECB’s fear that wage growth is accelerating worryingly across the 15-country eurozone, threatening its attempts to bring high headline inflation rates back under control. The ECB was “strongly concerned” about such “second-round” effects, he said.
Going further than his previous comments, Mr Trichet went on: “First signs are already emerging in some regions of the euro area.”
Last week, the ECB raised its main interest rate by a quarter percentage point to a seven-year high of 4.25 per cent, citing rising inflation risks. The move was intended largely as a warning signal to wage negotiators not to build current high inflation rates into wage deals.
Data last month showed eurozone hourly labour costs rose 3.3 per cent in the year to the first quarter of 2008 – the fastest rate since early 2003. Particularly alarming for the ECB was the 5.7 per cent rise in Spain that came in spite of clear signs that the country’s economy is heading towards recession on the back of a collapsing house price boom.
The ECB is also watching pay deals closely in Germany, which has exercised wage moderation in recent years.
However, Mr Trichet’s comments appeared to confirm that the ECB was not yet envisaging further interest rate rises. The ECB president repeated his statement last week that the central bank’s current monetary policy would contribute to bringing inflation back within its target of an annual rate “below but close” to 2 per cent.
Eurozone inflation stands at 4 per cent and is expected to rise further in coming months.
At the same time, Mr Trichet stressed again the downside risks to eurozone economic growth – suggesting the ECB believes slower economic activity in coming months will also reduce inflation pressures.
Powered by Germany, the eurozone saw strong growth in the first quarter – although revised data on Wednesday showed gross domestic product had increased by 0.7 per cent, rather than the 0.8 per cent previously reported. But the second quarter is thought to have been flatter, with Germany’s economy possibly having contracted by as much as 0.5 per cent, economists said.
Mr Trichet underlined his opposition to wage indexation schemes, which link pay deals to past inflation rates and are widespread in countries such as Spain, Belgium, Luxembourg and, to a lesser extent, in France.
An ECB research paper released this week argued that “backward-looking wage indexation enables temporary price shocks to initiate wage-price spirals leading to both persistent wage and price developments”.
Mr Trichet argued in the European parliament that in the early 1970s – at the time of the oil price shock – economies that had allowed “second round” effects to persist had subsequently seen high inflation and slow growth.
The period had also marked the start of mass unemployment, he added.
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China shoots dead five ‘holy war’ militants
By Mure Dickie in Beijing
Published: July 9 2008 19:12 | Last updated: July 9 2008 19:12
China claimed on Wednesday that its police killed five members of a group seeking to wage “holy war” in mainly Muslim Xinjiang just days after a top security official said separatists from the far-western region were one of the most pressing threats to next month’s Olympic Games.
It is likely to fuel efforts to tighten security in the capital ahead of the Games. Xi Jinping, the vice-president, said security was the priority in Olympic preparations as police announced plans for hundreds of checkpoints on roads to the capital.
The scale of the danger posed by Xinjiang-related terrorism to the Games remains impossible to gauge. Critics accuse China of trying to exaggerate the threat in order to justify harsh suppression of dissent in the region.
Beijing’s official Xinhua news agency reported that police in the Xinjiang regional capital had shot dead five members of the Uighur ethnic minority on Tuesday after they and 10 others confronted officers seeking to arrest suspects in a May stabbing.
“When 15 policemen surrounded the apartment where the suspects were hiding, they found themselves face to face with 15 knife-wielding Uighurs, all shouting ‘sacrifice for Allah’,” Xinhua said in a report carried on its English-language service.
“The [surviving] suspects confessed they had all received training on the launching of a ‘holy war’. Their aim was to kill Han people,” the agency said, referring to members of China’s dominant ethnic group.
However, Xinhua’s Chinese-language reporting of the police action described the incident as a criminal matter, making no mention of holy war, Allah or anti-Han intentions. Local police and prosecutors declined to comment.
Chinese rule is unpopular among many Uighurs, and some human rights activists say that government crackdowns on dissent and controls on religious activities risk fuelling fundamentalism in the region.
Beijing has long sought to characterise pro-independence dissent in Xinjiang as a terrorist threat, citing in particular a little-known militant organisation known as the East Turkestan Islamic Movement.
However, the World Uighur Congress, an exile group, last month claimed that official warnings of terrorist action were merely a cover for crackdowns against peaceful dissent.
“China is deceitfully playing the ‘terrorism’ scare card... in order to justify its pre-emptive strike against any form of political activities of Uighurs before and after the Olympic Games,” the group said.
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Gazprom offers to buy all Libya’s gas
By Ed Crooks and Catherine Belton
Published: July 9 2008 22:54 | Last updated: July 9 2008 22:54
Gazprom, Russia’s state-controlled gas company, said on Wednesday it was in talks to buy all of Libya’s oil and gas exports, in its latest effort to strengthen its influence over world energy markets.
Alexei Miller, Gazprom’s chief executive, made the offer in talks with Muammer Gaddafi, the Libyan leader, in Tripoli.
In a statement after the meeting, Gazprom said: “Libya positively evaluated Gazprom’s proposition to buy all future volumes of gas, oil and [liquefied natural gas] designed for export at a market price.”
The offer fits Gazprom’s strategy of seeking to secure sources of supply outside its Russian base and, in particular, to tie up future gas imports into western Europe.
It will raise concerns in the European Union that Gazprom is seeking to increase its dominance of Europe’s gas market, already set to grow as production in countries such as the UK and the Netherlands falls.
Libya is a member of Opec, the oil cartel, and produces 1.7m barrels of oil per day. However, it has been attracting more interest recently for its potential as a gas exporter to the EU. It held its first gas-only licensing round last year, in which Gazprom was one of the successful bidders. BP and ExxonMobil have also signed deals to look for gas in the country.
Mr Miller has been dismissive of the idea of a possible “gas Opec”, a cartel of gas producers that would co-operate to support prices. But Gazprom’s interest in securing Libya’s future gas exports will fuel fears that it is attempting to create just such a cartel.
Gazprom, which has a monopoly on Russia’s gas exports, has also recently opened an office in Algeria, one of the three leading gas suppliers to the EU, along with Russia and Norway.
Alexander Medvedev, its deputy chief executive,said last month: “Co-operation between our companies in Russia and Algeria is a priority.”
Gazprom has also been in talks with Nigeria about becoming involved in the planned gas pipeline from that country to Algeria, and future projects for LNG exports.
However, these initiatives are generally embryonic.
A Gazprom official said the company was seeking to “strengthen its position on world markets”, adding: “We need to diversify our markets and sources.”
He said the offer to Libya was a “non-binding proposal” and that talks could go on for some time.
Gazprom said the two sides had also discussed creating a joint venture for the exploration and development of oil and gas fields, and for building energy infrastructure in Libya, as well as gas pipelines to the EU.
In one of his last foreign trips as president, Vladimir Putin in April became the first Russian leader since 1985 to visit Libya.
Huge reserves
Libya had total proven oil reserves of 41.5bn barrels in 2007 – the largest in Africa. About 80 per cent is located in the Sirte basin but analysts believe only about 25 per cent of the country’s reserves are covered by exploration agreements with oil companies.
Most of the country’s oil exports, which in 2006 stood at 1.5m barrels a day, are sold to European countries including Italy, Germany, Spain and France.
Libya’s proven natural gas reserves at the beginning of 2007 were estimated at 52,700bn cubic feet, the fourth largest in Africa.
Since United Nations and US sanctions were lifted in 2003 and 2004, oil groups have stepped up exploration efforts for oil and natural gas and tried enhanced oil recovery techniques to increase production at maturing fields.
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UAE to farm its own caviar
By Simeon Kerr
Published: July 9 2008 17:49 | Last updated: July 9 2008 17:49
In the comic novel Salmon Fishing in the Yemen, a western fish expert teams up with a sheikh to bring salmon fishing to the mountains of the south-western Arabian peninsula.
On the other side of Arabia, life is not quite imitating art – but a United Arab Emirates-German joint venture is building a vast sturgeon fish farm in Abu Dhabi.
While the novel’s madcap idea ended in disaster, the Abu Dhabi initiative aims to provide a lucrative export opportunity for the UAE as it seeks to diversify away from oil production, while also helping safeguard the future of the endangered species.
Bin Salem Group and United Food Technologies, its German partner, are investing $80m in the project, centred around a climate-controlled facility in an industrial park on the outskirts of the capital. Here 64 swimming-pool-sized basins will house thousands of sturgeon, ultimately providing up to 40 tons a year of caviar and 710 tons of smoked and sliced sturgeon meat.
Work has started on the farm, the world’s largest single-site plant, which should take 14 months to build. The joint venture, which has not yet been named, will take two years from the start of operations to bring fish to the maturity needed to produce the high-grade Ossetra caviar. The Ossetra sturgeon is smaller than the famous Beluga and it is said to produce a more intense, nuttier-tasting roe. A 100-gram tin of wild Ossetra sells for £250 in London.
“We are not compromising on taste. It’s the same as wild caviar,” says Ahmed al- Dhaheri, Bin Salem’s chief executive.
Initial stock of 146,000 Siberian fingerlings (young fish in their first or second year) currently being reared by UFT in Germany will be complemented by 86,000 more at a later stage as the project builds up enough stock to produce farmed caviar for its European customers. Thereafter breeding is planned to replenish the stock, allowing the plant to become self-sustaining.
Five years in the making, Bin Salem Group forged ahead with the project when the United Nations Convention on International Trade in Endangered Species, known as Cites, limited the export of Caspian Sea sturgeon, squeezing the market for the prized delicacy.
“We saw the gap between supply and demand and then the UN resolution created a great opportunity for a new industry – caviar farming,” says Michel Nassour, Bin Salem’s financial adviser.
Bin Salem Group says the project will abide by international regulatory standards, avoiding the “inhumane” practice of harvesting caviar and then stitching up the fish in the hope that it will produce another batch.
“The quality of this technique is less and we believe it is against animal rights – we don’t want to go near that,” says Mr Nassour.
Instead, as the fish reach maturity the pools’ temperature is lowered until the fish become “sleepy”, at which point the caviar is cut out. The rest of the fish is harvested as smoked and sliced sturgeon fillet, which, unlike caviar, is rarely found on Gulf menus.
Confident of rising global demand for aqua-farmed caviar, the joint venture is already considering a second facility in the UAE. It has also received interest from a Malaysian company in the German-pioneered technology being used at the Abu Dhabi farm.
The initiative differs from the average development at the Industrial City of Abu Dhabi, located on the outskirts of the capital, and will certainly have more interesting by-products than the heavy industry surrounding the facility.
Mr Dhaheri is already considering what to do with the water from the sturgeon basins, which will be full of nutrients and ideal for hydrating vegetation. The fish remains make an ideal agricultural fertiliser.
Other Bin Salem projects are also following an environmental bent amid other government-led projects that aim to tackle the UAE’s position as one of the world’s worst environmental offenders, especially in carbon emissions.
The company, which has interests spanning education, car maintenance and military supplies, is considering an innovative vegetable-growing plant as the food-importing UAE is hit by global food inflation. The group is also developing technology to make wood panels out of recycled fibres from palm trees.
“We have been trying for years to move into environmentally friendly aspects to help society, and it’s good that the country is working towards this too now. It gave us the strength to move forward on our projects,” says Mr Dhaheri.
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A bad run brings Macao’s gambling king to market
By Tom Mitchell and Robin Kwong
Published: July 8 2008 19:25 | Last updated: July 8 2008 19:25
The large stone house at the crest of Wong Nai Chung gap on Hong Kong island, where exclusivity increases with altitude, is protected by an ornate black and gold gate embellished with royal and mythological motifs. A helmeted angel gazes down as a centaur, armed with bow and arrow, takes aim at a ram. A lion and maiden complete the tableaux.
No 1 Repulse Bay Road is the residence of Stanley Ho, the “gambling king” of Macao, and the house reflects both the wealth and 1970s aesthetic sensibilities of its occupant, according to one person who has visited.
Mr Ho’s preference for the décor of past decades is not surprising considering that he will turn 87 this year and began amassing his fortune in earnest in 1962 – the year that his corporate flagship, Sociedade de Turismo e Diversoes de Macau, was awarded a 40-year gaming monopoly in the then Portuguese colony. Thursday is expected to mark another milestone, and perhaps the last great act in Mr Ho’s long career, as Sociedade de Jogos de Macau, STDM’s gaming arm, makes its debut on the Hong Kong stock exchange.
SJM’s road to market has been a long and tortuous one, dogged by bad luck and controversy. But its initial public offering is also one of the most revealing that the exchange has hosted. The company’s prospectus sheds rare light on the inner workings of an old-school Chinese family empire – Mr Ho has had 17 children by four wives – and the way things are done in clubby Macao, China’s “other” special administrative region 40 miles west of Hong Kong.
The on-again, off-again listing process has been closely monitored by Chinese government officials worried about the growing clout of American commercial interests in the territory, according to industry executives. A successful IPO, people close to the company argue, would effect a much-needed transformation of SJM, allowing it to compete better against listed overseas rivals.
In 2006, four years after SJM’s monopoly lapsed, Macao eclipsed the Las Vegas Strip as the world’s biggest casino market. In the first quarter of this year the territory’s gaming revenues grew more than 60 per cent to $3.7bn (£1.9bn, €2.4bn) – bigger than the Strip and Atlantic City combined. But most of the benefit from this growth has flowed to five recent entrants, led by Las Vegas Sands and Wynn Resorts of the US.
MGM Mirage, another American gaming giant, has a joint venture with Mr Ho’s daughter Pansy, while Consolidated Media Holdings of Australia has teamed up with Mr Ho’s son Lawrence. In October the final player, Hong Kong’s Galaxy Entertainment, sold a 20 per cent stake in its Macao operations to Permira, the UK private equity company.
After the Galaxy-Permira transaction, SJM stood alone as Macao’s last wholly Chinese-owned casino company, making the revival of the former monopoly a matter of intense interest to Chinese officials. Despite the Macao market’s rapid growth – from $5.7bn in 2005 to $10.3bn last year – SJM’s revenues have fallen slightly over the same period, from $4.3bn to $4.1bn.
SJM envisaged a $2bn offering when the idea was first mooted three years ago. That was scaled back to $1bn in January, only to be delayed again by poor market conditions and queries from Hong Kong’s market regulator about a long-running legal dispute between Mr Ho and his sister Winnie. Mr Ho, according to SJM’s prospectus, is “directly and indirectly interested in more than 30 per cent of [STDM’s] equity share capital”, while Winnie holds a 7.3 per cent stake.
Mr Ho’s sister has launched a last-minute judicial review challenging the approval of SJM’s listing by the Hong Kong regulator and stock exchange, with a ruling expected on Wednesday. If successful, Winnie’s spoiler suit could force yet another delay.
One of the great mysteries surrounding STDM, an expansive property, transport and gaming conglomerate, has long been who owns exactly how much of it. As SJM’s prospectus casually notes, “the shareholders register of STDM is lost”.
But for the first time in a public document, SJM’s prospectus offers a “full list” of 44 STDM shareholders “based on share scripts sighted, deeds executed and decisions taken in certain court proceedings”. In addition to Mr Ho’s and Winnie’s approximate equity interests, the list includes his third and fourth wives, three more Ho sisters and one daughter. But lest anyone think this ends the uncertainty surrounding STDM’s shareholding structure, a footnote cautions: “This list reflects the list of shareholders used for STDM shareholders’ meetings pending the reconstitution of the share register of STDM. See Risk Factors ... ”
When SJM’s offering was revived last month, it had to be pared back again to $494m. Mr Ho has been forced to lower his ambitions at each attempt, in part because of the deterioration in SJM’s performance over the past three years, during which time the company’s share of Macao’s gaming revenues fell from 75 per cent to 30 per cent and profits retreated from $690m to $190m.
Market conditions have not helped either. Hong Kong’s benchmark Hang Seng index is down 31 per cent from its October peak. That SJM and Deutsche Bank, which is arranging the IPO, have been able to pull off the listing in these conditions is, says one person close to the transaction, “nothing short of heroic ... Clearly this is not a listing about the past. If you were pitching the past, you’re not going to get this thing away”.
“Any monopoly has a level of inertia that has to be overcome,” adds Frank McFadden, SJM’s president for joint ventures and business development. “We’ve cast off the inhibitions of a monopoly and really wound up our sleeves and got stuck into a more competitive environment. It’s bearing fruit.”
Besides buying a turnaround story that hinges on SJM’s new flagship casino, the Grand Lisboa, investors will be betting that the company has embraced a more transparent culture. STDM, which will hold 61 per cent of SJM after its listing, provides an array of services to the company. SJM also conducts business with a host of smaller private companies in which Mr Ho, his family members and STDM directors have beneficial interests. SJM’s transactions with such vested interests are so prolific that the company’s auditors have broken them out in the company’s prospectus.
To reassure investors that sweetheart deals are a thing of the past, SJM has signed agreements with STDM committing the latter to tender products and services at either the best available “market price” or a “contractual price” yielding no more than a 6 per cent profit margin.
“We have trawled through all these [related-party transactions] and have a committee in place to look into any future transactions and make sure they take place at arm’s length,” says Ambrose So, SJM chief executive. “In this regard investors are protected.”
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OECD says UK youth prospects worsen
By Andrew Taylor, Employment Correspondent
Published: July 9 2008 10:05 | Last updated: July 9 2008 10:05
The youth unemployment rate in the UK is higher than when Labour came to power in spite of government efforts to reduce it, according to a report by the Organisation of Economic Co-operation and Development.
Part of the reason for the rise in UK youth unemployment is the increased numbers of youngsters in education and training, says Glenda Quintini, OECD economist and author of the report.
Nonetheless “job prospects for this age group have worsened in recent years at a time when the OECD average youth unemployment rate was falling.”
The unemployment rate for the 16 to 24 age group in the UK has risen from 13.4 per cent since 1997 to 14.4 per cent - a full percentage higher than the average for the 30 OECD countries.
The findings will be embarrassing for the government which targeted reductions in youth unemployment as one of its main policy aims when came to power in 1997.
Labour’s efforts to cut youth unemployment, through programmes like the New Deal, were initially successful in reducing the unemployment rate in the age group from 17 per cent in the mid 1990s to 11 per cent by 2004 but this trend has since reversed, says the OECD.
The employment rate for youngsters has also fallen from 60.9 per cent in 2002 to 55.9 per cent last year - although this is still well above the average of 43.6 per cent for developed nations.
Britain has also been successful in cutting long term unemployment for youngsters with the jobless rate in this category falling from 23.3 per cent in 1997 to 16 per cent - almost 4 percentage points below the OECD average of 19.6 per cent.
But efforts to reduce the proportion of youngsters not in education, employment or training (Neets) have been disappointing with the proportion of Neets among 16 to 24 years olds rising from 11.6 per cent to 13 per cent over the first decade that Labour was in power.
The OECD said government proposed policies, such as raising to 18 the age that youngsters must remain in education or training were heading in the right direction, but more “fine tuning” was required.
It called for increased support for early childhood education; a three month limit for 16 and 17 years olds to find work with part time learning after which they must return to full time education or training; more involvement for trade unions in the development of apprenticeship schemes; and an expectation that youngsters finding work under New Deal programmes stay in a job for at least 26 weeks.
A UK government spokesman said: “The picture for young people in employment, training and education in this country is improving but more needs to be done. We welcome the fact that the OECD recognises much of the gains made, including the considerable improvements in youth employment.
“We have seen youth claimant unemployment amongst 18 to 24-year-olds fall since 1997 with long-term claimants, of over one year, down by over 90 per cent. This has saved £500m per year of taxpayers’ money and increased the life chances for many young people.
“And the latest statistics for 16 and 17-year-olds in education, training or employment also show significant improvements with a 10 per cent reduction in those not participating. But we must go further.”
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Further UK housebuilding gloom
By Amanda Vermeulen
Published: July 9 2008 20:16 | Last updated: July 9 2008 20:16
The flood of grim news from Britain’s housebuilders has continued unabated, with Bovis Homes and Redrow both announcing 40 per cent reductions in their workforces and the cutting of dividends.
Redrow’s trading update for the year to June was worse than analysts expected, with Neil Fitzsimmons, chief executive, warning “a significant” writedown to its £650m land bank was likely. Meanwhile, there was surprise at the depth of Bovis’s dividend cut in its update for the six months to June.
In spite of the bad news, shares in both companies performed well, largely because of hopes for sector consolidation and the prospect of beefed up regulation of the US housing market. Shares in Bovis rose 5½p to 323p on Wednesday, while those in Redrow, which have plummeted nearly 80 per cent in the past year, added 3¾p to close at 100p.
Rachel Waring, an analyst at Panmure Gordon, said the bounce in the housebuilding sector followed news that the US Federal Reserve could improve oversight of the US mortgage market, as well as speculation that builders could be ripe for takeovers.
Bovis, Britain’s most profitable housebuilder, will declare only a 5p interim dividend after initial expectations of a 20p pay-out. The final dividend is also under review, with Bovis signalling the yearly total may be as little as 10p, against 35p last year.
Ms Waring said Bovis was stronger that its peers financially, “with a deliciously high gross margin, but the [dividend cut] is bitterly disappointing”.
The group will lay off 40 per cent of its workforce, about 360 jobs, adding to significant redundancies announced recently by Taylor Wimpey and Persimmon.
A “non-material” adjustment to the value of the Bovis land bank was planned, but David Ritchie, chief executive, said the extent of the writedown would be reviewed before the half-year accounts are published in August, and at the year end.
The dividend at Redrow is also under review, with the outcome to be revealed in September when year-end results are published. Last year, the dividend was increased 20 per cent to 15.6p, with a “commitment” to increase this a further 20 per cent in 2008.
Redrow will cut 40 per cent of its workforce, about 500 jobs, to help generate £15m in annualised cash savings.
Simon Brown, analyst at Landsbanki, said Redrow’s trading update was weak even in the current trading conditions and he expected asset writedowns of £120m.
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Abu Dhabi fund takes control of Chrysler Building
By Daniel Pimlott in New York
Published: July 9 2008 20:09 | Last updated: July 9 2008 20:09
An Abu Dhabi sovereign wealth fund has bought a controlling stake in the Chrysler Building, an icon of the Manhattan skyline, in the second acquisition of a trophy asset in New York by a Middle Eastern investor in little more than a month.
The Abu Dhabi Investment Council is taking a 90 per cent stake in the landmark Art Deco tower for $800m, according to a person familiar with the deal. The building briefly held the title of the world’s tallest building until being pipped by the Empire State Building in 1931.
Prudential Real Estate Investors is selling its 75 per cent stake in the tower, while Tishman Speyer, the New York developer, will sell part of its 25 per cent stake, according to the person. Tishman Speyer declined to comment.
The acquisition comes after Meraas, an Dubai private equity fund, was among investors who took part in the $2.8bn acquisition of the GM Building in early June, along with Boston Properties and Goldman Sachs. That was the highest price ever paid for a US building, for a skyscraper with one of the most sought-after locations in Manhattan at the south east corner of Central Park.
Investors from the region have been a force in New York real estate for some time, rivalling Europe for the dollar volume of their investments in recent years.
Now many in the industry say they have seen increased interest from the Middle East, especially in top assets in major US cities such as New York, LA, Washington and Boston, as oil prices soar, the dollar remains weak and building values soften or fall.
The investments in the Chrysler and GM buildings come after Dubai World’s investment with MGM Mirage for a hotel, casino and residential project in Las Vegas, and a $1.4bn investment last year in developer Related Companies from investors including the Abu Dhabi government and a Saudi Arabian firm.
The foray into commercial property comes after Middle Eastern funds ploughed billions into US banks in the wake of their losses from the credit crisis.
ADIC was established last year as an alternative to the huge and longer-established Abu Dhabi Investment Authority, and had been thought to be more focused on investing in the Middle East and the Gulf.
The office building, not considered to be among the most desirable office spaces in the city, was completed in 1930 for Chrysler, the car company. It is 77 storeys tall and 319 metres high.
Prudential took control of the Chrysler Building stake when it bought TMW Real Estate, an Atlanta-based investment company. TMW had taken the investment in the building in 2001 for $300m. It was the last property sold by Prudential from funds managed for German investors, after the company sold 665 5th Avenue and the so-called Lipstick building, both in New York, over recent years.
“We are proud to have been able to invest in this US icon, and just as proud to be able to deliver exceptional returns to our German clients,” said a spokesperson for Prudential.
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Carrefour moves to restore French presence
By Peggy Hollinger in Paris
Published: July 9 2008 20:17 | Last updated: July 9 2008 20:17
Carrefour on Wednesday night set out a five-point plan to woo customers back into its flagging French hypermarkets and revive investor confidence already battered by last month’s profit warning and a tumbling share price.
Jose-Luis Duran, Carrefour chief executive, said the French retailer planned to take “strong and immediate action” to adapt to “an environment that is changing at a very fast pace”. Although the group’s total sales rose 6.7 per cent on a like-for-like basis in the second quarter, its French outlets lost market share as customers opted for smaller stores, cheaper own-label products and hard discounters.
Mr Duran said Carrefour needed to lure customers back with stronger promotions and hinted the retailer could launch its own price war at the petrol pump. He also flagged renewed pressure on suppliers of national brands, where sales slumped sharply in May and June. Carrefour would renegotiate contracts to lower prices.
The Carrefour boss outlined a series of other measures to address disappointments in the group’s biggest market. France accounts for about 45 per cent of sales, and Mr Duran has come under strong pressure from his two biggest shareholders – Bernard Arnaud and Colony Capital with a jointly held 10.7 per cent – to take stronger action.
Mr Duran said he was clamping down on costs to help fund price promotions. This included not only a review of general expenses but a hiring freeze in head offices. He refused to quantify the potential savings.
Capital spending would also be reallocated, with European store extensions and renovations now on hold. About €200m ($315m) would be freed up to fund accelerated openings in high growth markets such as Brazil, Taiwan and China. The group expects such markets to account for 35-40 per cent of total sales by 2010, up from 30 per cent. Carrefour will also scale back the size of many of its hypermarkets and seek sites for smaller stores. Sales and leasebacks were not ruled out.
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Casino giant Wynn could tap HK market: report
AFP
AFP - 2 hours 56 minutes ago
HONG KONG (AFP) - US casino billionaire Steve Wynn, whose firm operates Macau's Wynn resort, is exploring tapping Hong Kong's stock market for as much as 3 billion dollars, a report said on Thursday.
(Advertisement)
The company would use the cash to finance its ambitious expansion plans in the nearby gaming haven of Macau, the South China Morning Post said, citing unnamed sources.
However, the current poor market conditions in Hong Kong -- the benchmark index has tumbled more than 20 percent since the start of the year -- could delay any move, the report said.
"They are a long way away from [a share sale] and they might never do it," the unnamed source said, according to the report.
"At the moment, the market is definitely not right."
The report said Wynn's current plans to open a 400-room hotel tower called Encore next to its existing property did not need new financing.
Instead, it could use any cash raised from a share sale to build a resort on the Cotai Strip, a huge piece of reclaimed land close to Las Vegas Sands' huge Venetian Casino, which opened last August.
Several projects are currently being built there in an effort to recreate the Las Vegas Strip, which Macau last year overtook in terms of gaming revenue.
The potential listing comes as Wynn's Macau rival, Stanley Ho, is expected to take his company public in Hong Kong next week in a move which has reportedly raised around 500 million dollars.
A mixture of poor market conditions and legal action by his estranged sister, Winnie Ho, has delayed the listing since it was first mentioned in January, when the IPO was aiming to raise 2 billion US.
Since Ho's monopoly on gaming in the former Portuguese colony was broken up in 2002, the city has seen a flood of investment from foreign operators, transforming it into a gleaming gambling paradise.
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BP says oil may tumble if financial factors removed
Reuters
Reuters - 2 hours 56 minutes ago
SEOUL (Reuters) - Oil could face a "steep" fall if financial factors are removed from the current market, which gained around 40 percent this year, the chief economist at BP said on Thursday.
(Advertisement)
Oil prices have more than doubled from a year ago, driven partly by geopolitical instability from Iran to Nigeria as well as expectations that global supplies will fail to keep pace with unrelenting demand growth in the years ahead.
Non-market fundamentals, including financial factors such as the easing of the U.S. dollar against other currencies, have prompted investors to use oil and other commodities as a hedge against the weaker greenback and inflation.
"If the financial investors move out of the market, then there could be a rapid fall, a steep fall in prices," Christof Ruehl told Reuters on the sidelines of the London-based company's 2008 Statistical Review of World Energy in Seoul. He declined to give an estimate on the fall.
"Financial investors will look at real developments, and they will act upon them," he said, adding that financial factors were not triggering, but accelerating oil price fluctuations.
Earlier in June, BP CEO Tony Hayward said oil prices were unstable because markets were not well supplied, and higher taxes in producing countries were discouraging investment in new output.
Ruehl also said that inventory was the main factor that would determine oil prices, as there were very few new supplies coming into the market.
U.S. light crude for August delivery was around $136 a barrel Thursday, falling nearly $10 from last Thursday's record high of $145.85 a barrel, mostly due to a stronger dollar that has reduced the appeal of commodities for investors.
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企業物価、６月5.6％上昇 原油高騰、中間財に波及
日銀が10日発表した6月の国内企業物価指数（2005年＝100、速報値）は109.7となり、前年同月に比べ5.6％上昇した。第二次石油ショック末期の1981年2月以来、27年4カ月ぶりの水準だった。原油や石炭価格の大幅な上昇が化学製品や金属製品など中間材料に波及している。穀物高で加工食品の価格も上昇しており、川下への価格転嫁圧力が強まっている。
国内企業物価指数は、製品の出荷や卸売段階で企業同士が取引する製品価格水準を示す。6月の上昇率は前月（4.8％）を0.8ポイント上回った。前年同月比での上昇は52カ月連続。
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全漁連会長、全国一斉休漁で小売りに協力求める
全国漁業協同組合連合会（東京・千代田）の服部郁弘会長が10日、イオンとダイエーの大手流通2社を訪れ、15日の全国一斉休漁への協力を要請する。燃油高騰による漁業者の窮状を直接説明。水産物の流通のあり方の見直しに向け、小売サイドの協力を求める。
2社は食品担当の役員や幹部、水産物販売の責任者が対応する。イトーヨーカ堂などは担当幹部の日程の都合がつかなかったという。
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レナウン、英ブランド事業撤退
レナウンは10日、英カジュアル衣料ブランド「フレンチコネクション」の事業から撤退する方針を固めた。英フレンチコネクション（ロンドン）と折半出資で設立した日本法人の全持ち株を英本社に売却する。経営再建中のレナウンが進めている不採算ブランド廃止の一環で、経営資源を主力ブランドに集中する。
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富士フイルム、印刷用材料を15―20％値上げ
富士フイルムは10日、印刷用の材料を10月1日出荷分から15―20％引き上げると発表した。アルミニウムやガラスなど原材料価格が高騰しているため。
オフセット印刷で使う刷版材料ではデジタル印刷向けの「ＣＴＰ版」を17％、感光性アルミ版向けの「ＰＳ版」を15％引き上げる。刷版は印刷機に取り付けるプレートのことで、オフセット印刷はチラシやカタログなどの商業印刷で主流となっている。
このほか半導体製造時に使うフォトマスク（回路原板）の材料「ガラス乾板」も15―20％引き上げる。
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普通鋼鋼材受注量、5月は2.6％増 25カ月連続プラス
日本鉄鋼連盟が10日発表した5月の普通鋼鋼材受注量は、前年同月比2.6％増の671万4000トンだった。前年を上回るのは25カ月連続。国内では土木建設用が14.5％増と大幅に伸びたほか、産業用機械用も8.1％増と好調だった。外需も堅調に伸び、前年同月から6.7％増えた。
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トンボ鉛筆、２割短いボールペン 細身で手帳に挟みやすく
トンボ鉛筆は長さを11.4センチメートルと従来より約2割短くした油性ボールペン「ＺＯＯＭ（ズーム）717」を14日に発売する。ペン軸の直径もグリップ以外の部分で4.0ミリメートルと細めにし、ノートや手帳などに挟みやすくした。
軸のおよそ3割を樹脂で覆ってグリップにし、短くても握りやすいようにした。軸は真ちゅう製で、細くても十分な強度があるという。重さは8.5グラム。ボールの直径は0.7ミリで、インクの色は黒。本体は青、黄、紫の3色があり、価格は2100円。
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焼き物と煮物を同時調理、松下がスチームオーブンレンジ
松下電器産業は「焼き物」と「煮物」を同時に調理できるスチームオーブンレンジ「3つ星ビストロ ＮＥ―Ｒ3000」を9月1日に発売する。
食材表面を高温で焼く遠赤外線、内部に熱を浸透させる近赤外線、通常の電子レンジで使われるマイクロ波をそれぞれ適切に制御する新機構、「光ヒーターシステム」を搭載する。専用のグリル皿で庫内を上下に区切ると、調理方法に合わせて別々に加熱できる。
「鶏の照り焼きとカボチャの煮物」など132通りの組み合わせが可能。スチーム（過熱水蒸気）を使って肉の余分な脂を落としながら、表面をパリッと焼き上げることもできる。
価格はオープンだが店頭実勢は15万円前後と見込む。月に5000台の生産を計画する。
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大手家電量販店、小型パソコン「100円」で販売
コジマやヨドバシカメラなどの大手家電量販店が10日から、小型パソコンとデータ通信用カード端末をセットで100円で売り出す。イー・モバイルが同日始めるデータ通信の新料金プランと2年間契約することが条件。初期費用が少なくて済み、小型パソコンの普及に弾みがつきそうだ。
イー・モバイルのデータ通信サービスは、専用カード端末をパソコンに差し込むことで、屋外などでインターネットを利用できる。かつての「1円携帯電話」と同様、パソコンなどのハード価格を安くし、代わりにデータ通信の料金を高くすることで「100円パソコン」を実現した。毎月の基本料金でみると、従来より900円高くなる。
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日揮、アルジェリアで原油・ガス処理プラントを受注
日揮は北アフリカのアルジェリアで、原油・天然ガス処理プラントを受注した。受注額は約500億円。原油とガスを収集・分離する施設を2011年半ばまでに完成させる。日揮がアルジェリアに持つエンジニアリング子会社との共同受注の形を採る。中東・アフリカ地域の資源関連プラントは建設コストの高騰が続く。現地子会社を活用して進ちょく管理を徹底し、採算性を向上する。
アルジェリアの国営炭化水素公社（ソナトラック）から受注した。建設地は同国東部のルードヌース地区。内陸部の油田で産出される原油とガスを新プラントで収集・分離する。処理後はパイプラインで製油所やガス処理施設に送られ、主に欧州に輸出される。
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百貨店、低価格衣料を拡充 消費者の節約志向に対応
百貨店が低価格衣料品の販売を強化する。高島屋と東武百貨店は夏のバーゲンセールを実質的に延長する形で、既存商品より2―3割安い商品を8月末まで投入。Ｊ・フロントリテイリングは同じく2割安いプライベートブランド（ＰＢ＝自主企画）商品を拡充する。消費者の節約志向の高まりで、5月まで11カ月連続で前年割れが続く衣料品販売をテコ入れする。
高島屋は8月中旬まで、「ナイスプライス商品」と名付けた低価格商品の販売を強化する。紳士服、婦人服合計で約140ブランドをそろえ、販売額は20億円以上を見込む。通常、業界では7月上旬から中旬にかけて夏物衣料品の在庫処分バーゲンを実施し、その後は秋物の販売に重点を移す。今年は夏物需要をバーゲンだけでは取りきれないと判断し、実質的に期間を延長する。
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日航、福島空港から撤退 燃料高騰で、関西―ロンドンも検討
日本航空は2009年1月末に福島空港発着の路線から撤退する方針を固めた。福島空港と関西国際、大阪（伊丹）、那覇の3空港を結ぶそれぞれ1日1往復の運航をとりやめる。同社は関西―ロンドン線からの撤退も検討。燃料価格が想定以上に高騰しており、不採算路線からの撤退を進める。
福島発着の3路線の運航を1月末までで休止することを地元、福島県へ伝えた。空港内の事務所と福島支店（福島県郡山市）も閉鎖する。3路線は搭乗率が 5―6割にとどまっている上、旅客単価も低く燃料高騰で赤字幅が拡大していた。福島県は路線存続を申し入れるが、日航が受け入れるかどうかは不透明だ。
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三菱商事、豪でウラン権益 160億円投資、加社と組む
三菱商事はウラン資源最大手のカメコ（カナダ）と共同で、ウラン鉱山の権益を豪州で買収した。英豪系資源大手リオ・ティントが保有する鉱区で、取得金額約530億円のうち三菱商事は3割の160億円を負担する。原油高や地球温暖化への対応から、世界各国で原子力発電所の新設計画が加速している。東芝など国内原発メーカーの海外受注も相次いでおり、燃料であるウラン争奪戦も激しさを増してきた。
権益を取得したのは西豪州の州都、パースの北東約1250キロメートルに位置する「キンタイア鉱区」。確認埋蔵量が3万2000トンで、日本の年間消費量（約9000トン）の3―4年分に相当する。
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在日ブラジル人社会保障を改善 日ブラジル首脳会談
福田康夫首相は9日夜、ブラジルのルラ大統領と会談した。大統領は在日ブラジル人対策での協力強化を求め、首相も「在日ブラジル人は両国の相互理解に大きな役割を果たす。社会保障、教育などの問題を解決したい」と同意した。
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小麦粉２トン盗難 埼玉の倉庫、価格高騰背景か
10日午前2時ごろ、埼玉県東松山市大谷の製粉会社「日穀製粉」（本社長野市）の倉庫から一袋25キロ入りの小麦粉90袋（計約2.2トン、約27万円相当）が盗まれているのを、配送業務のため出勤した男性従業員（50）が気付き110番した。東松山署は窃盗事件として調べている。
調べでは、倉庫通用口の鍵が開けられ、倉庫内に止めた4トントラックの荷台に積んであった40袋と、近くにあった50袋がなくなっていた。盗まれたのは、うどん用とそばのつなぎ用の小麦粉。
男性従業員は9日午後8時ごろ、通用口に施錠して帰宅。トラックの距離計には9日夜以降に約8キロ走行した記録が残っており、何者かがこのトラックを使って小麦粉を運び出したとみられる。
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８物件で不具合を確認 ＪＩＳ規格外生コン使用
神奈川県藤沢市の生コン製造「六会コンクリート」がＪＩＳ規格外の生コンを使用していた問題で、同社は10日、神奈川県内の8物件でコンクリートの壁の表面がはがれる不具合があったと発表した。
小金井弘昭社長は同日、横浜市内で記者会見し「偽装と言われても仕方がない。関係先や社会に迷惑を掛け申し訳ありません」と謝罪した。
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採用で不正の県教委参事「断れば出世外れる」 大分汚職
大分県の教員採用をめぐる汚職事件で、県教育委員会義務教育課参事の江藤勝由容疑者（52）＝収賄容疑で再逮捕＝が、採用試験で不正を働いた理由を「上層部からの指示を断れば出世ルートから外れる」と供述していることが10日、関係者の話で分かった。
江藤容疑者は合格者リストを作成するなど採用を統括する立場で、受験者の点数を加点した見返りに現金や商品券を受け取った疑いが持たれている。県警は謝礼のほかに、県教委上層部からの指示が心理的圧力になったとみて調べている。
また江藤容疑者は「上層部からの直接的な見返りはなかった」とする一方で「自分だけが捜査のターゲットにされた」と供述しているという。県教委内では採用担当者が不正操作の“汚れ役”を請け負う構造が成り立っていたとみられる。
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大分教員汚職、小学校採用で合格者10人を不合格に
大分県の教員採用をめぐる汚職事件で、採用担当だった県教育委員会義務教育課参事、江藤勝由容疑者（52）＝収賄容疑で再逮捕＝が2007年の小学校採用試験で行っていた不正の全容が9日、関係者の話で分かった。県教委上層部の口利きがあった受験者15人前後の点数を最大百数十点水増しし合格させる一方、一般の受験者を減点、本来合格だった約10人を不合格にしていた。
また、江藤容疑者が06、07年の小学校採用試験で不正に合格させた約30人の中に、複数の県議が口利きしたケースが含まれていることが、関係者の話で分かった。
江藤容疑者は、試験での操作について「07年は、発覚を恐れた上層部から『一般受験者にも配慮しよう』と指示があったが、06年はもっとひどかった」などと供述しているという。県警などは不正が組織ぐるみで常態化していたとみて、06年についても本来合格していたのに不合格となった受験者の実態解明を進めている。
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原発燃料工場、微量のウラン飛散 横須賀
原子力安全・保安院は10日、原子力燃料製造会社「グローバル・ニュークリア・フュエル・ジャパン」（神奈川県横須賀市）の工場内でウラン化合物が漏れ、清掃作業中の作業員1人がわずかに体内被曝（ひばく）する事故があったと発表した。外部への影響は確認されていないという。
ただ、同社側からの連絡は事故発生から約6時間半後だったため、保安院は同社を厳重注意した。
保安院によると、作業員の被曝量は、日常生活で自然界から浴びる放射線（1ミリシーベルト）をやや上回る1.12ミリシーベルトで、人体に悪影響はないという。
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仮出所者、農業で自立を 法務省、茨城に更生施設設置へ
法務省は9日、仮出所者らの就労を支援するため、茨城県ひたちなか市内に農作業訓練を中心とした更生保護施設を2009年度に設置する方針を固めた。仮出所者の更生に農作業訓練を採り入れる試みは初めて。入所者は施設から農業学校に通って農業を学ぶ。就職先を確保できなかった仮出所者に目立つ高い再犯率に歯止めをかけるのが狙いだ。
設置を計画しているのは、更生保護施設「茨城（ひたちなか）就業支援センター」（仮称）。農業関連の職業に就く意欲の高い仮出所者や満期出所者を受け入れ、寝泊まりの拠点とする。定員は12人程度の予定。
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“居酒屋”不況到来「甘太郎」「和民」など売上低迷
積極出店から既存店強化へ
サラリーマンの憩いの場「居酒屋」に逆風が吹いている。給料が伸び悩んでいるため、お父さんの小遣いも低迷し、ノレンをくぐる回数も減りがち。加えて、原油高や原材料高が居酒屋の経営を直撃し、弱り目にたたり目といった感じなのだ。こうした状況に、外食大手もこれまでのようなイケイケドンドンの新規出店を見直し、既存店のテコ入れに力を入れ始めている。仕事帰りの一杯すらままならないご時世は、なんとも寂しいかぎりだ。
居酒屋チェーンを展開する外食大手では最近、積極出店して規模拡大を目指す姿勢を改め、既存店の体質強化へと大きくかじを切っている。不採算店の閉鎖と出店をバランスよくやり、もうけが出る態勢づくりを進めているわけだ。
居酒屋チェーンの「甘太郎」「北海道」などを展開するコロワイド（横浜市）は、２００８年３月末の店舗数が１年前より４８店減って９３３店になった。０７年度中に２１店を出店したが、不採算や重複する店舗など６９店を閉めたためで１９９９年の上場以来、初めての店舗減少となった。
「コロワイドは居酒屋業態を中心に既存店売上高が想定以上に低迷し、０８年３月期の連結売上高は前期比０．３％減の１１６６億円になった」（証券アナリスト）
「和民」「坐・和民」などを展開するワタミ（東京都大田区）も、０８年３月末の店舗数が１年前より１２店減って５９８店になった。０７年度中に１２店を出店したが、不採算店などを２４店整理したため、６００店の節目を割り込んだ。
「居酒屋業界では、各社とも既存店売上高が対前期比で１００％割れが続いており、ワタミでも０８年３月期のグループ既存店売上高は前期実績の９７％にとどまっている」（同）
店舗数を減らした両社は今年度、出店を増やす方針で、０９年３月末までに「１０店増の９４３店にする見通し」（コロワイド広報）、「１９店増の６１７店に増やす予定」（ワタミ広報）という。
ただ、これはあくまで現時点での計画。「消費低迷がさらに深まり、原油高や原材料高の影響が大きくなっていけば、必然的に計画を見直さざるを得なくなるだろう」（同）とみられている。
日本フードサービス協会（東京都港区、正会員・賛助会員合わせて８３４社）の調査では、「パブレストラン・居酒屋」の店舗数はジリジリ減り続けている。直近の５月調査の結果をみても、店舗数は１７７８店で前年同月より２８店減少。昨年１０月以降、８カ月連続で前年同月割れを記録している。
「この調査は、会員へのアンケートという形で行われており、回答しなかった会員企業の店舗数は含まれない。そのため、調査で出てきた店舗数と実際の店舗数とは若干の開きがあるとみられるが、それでも居酒屋が減少傾向にあるのは紛れもない事実」（関係者）という。
居酒屋の減少傾向について、第一生命経済研究所の主任エコノミスト、永濱利廣氏はこう指摘する。
「単純に利用者が減っているのが要因です。直接的には少子化による人口減、間接的には給与水準の低迷による外食控えがある。携帯電話などの通信費の負担増から、若者たちの節約意識が高まっていることもあるでしょうね。これに原油高による原材料費の高騰が加わる。居酒屋減少の理由を挙げたらキリがありません」
原油高で漁船が休業するご時世。料理の原材料やビールなどの価格が上昇しているが、安さがウリの居酒屋だけにメニューへの価格転嫁はなかなかスムーズにはいかない。ライバルの居酒屋との客の奪い合いが激しくなるほど、転嫁は進まないことになる。
居酒屋を取り巻く環境はとにかく最悪。生き残りをかけた戦いをどう勝ち抜けばいいのか。永濱氏は次のようにアドバイスする。「物価高で生活防衛意識が急速に広まるなか、『どうせ外食するなら専門店』という傾向も高まっています。すしや焼き肉、ラーメンなど、そこにしかない個性がウリのお店は、そこそこ奮闘している。居酒屋が元気を取り戻すとしたら、これがヒントになるかもしれません」
政財界には、来年にかけて日本の景気はドン底へと向かうとの観測もある。居酒屋復活は容易ではなさそうだ。
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カラーコンタクトで重症も…度なしレンズ被害１６７件
度が入っていないおしゃれ用のカラーコンタクトレンズで目の異常を訴える被害が２００５年１０月から今年２月にかけて計１６７件あったことが１０日、独立行政法人「製品評価技術基盤機構」の調査で分かった。
近視や乱視に対応し度の入ったカラーコンタクトレンズは医療機器だが、度のないレンズは雑貨品扱いで、通販でも購入できる。機構は「目に直接触れるので、度がなくても薬事法で規制すべきだ」と提言している。
調査は全国の眼科医を対象にアンケート方式で実施。１６７件のうち２１件は、角膜潰瘍（かいよう）などで失明の恐れがある重症だった。
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カラーコンタクト：店頭で「責任負いかねます」 販売規制、専門家「当然だ」
若い女性に人気のおしゃれ用のカラーコンタクトレンズが、目の異常を訴える被害が相次いだことを受け、販売規制がかけられることになった。インターネットなどを通じ、事実上野放し状態で売られ、店頭で客に医療上の免責を趣旨としたとみられる文書に署名させるケースも。眼科医だけでなく、コンタクト業界から規制を歓迎する声も出た。【奥山智己、真野森作】
東京都内の女子大学生（１８）は、２年前から度なしのカラコンを使い始め、今年１月には自宅近くの大手ディスカウント店で約４０００円で購入した。その際、「お客様とのお約束」という文書に署名させられた。そこには、「医療上の責任は負いかねます」などと記載されていた。
店の担当者は、毎日新聞の取材に「署名は販売管理上必要なもので免責のためではない」とし、「誤解を与える」との理由で４月以降、「医療上の責任は負いかねます」との記載を削除した。
視力矯正用のカラコンを扱うメーカー大手のチバビジョン（東京都品川区）は「コンタクトは医師の処方に基づいて正しい使い方をしないと安全を担保できない。（おしゃれ用の）粗悪品と医療機器のコンタクトを一くくりにされてしまうと困る」（広報部）と話し、規制に理解を示す。
規制の動きに、日本コンタクトレンズ協会の担当者は「協会とは関係がないのに、クレームが寄せられており、規制が必要と思っていた」と話した。
社団法人「日本眼科医会」の常任理事で医師の宇津見義一さんは「カラコンを装着すると異常な低酸素状態になる。また、通販などで、適切な洗浄や消毒、保存方法を指導しておらず障害が起きやすい。材質がよく分からない物もあり規制は当然」と指摘する。
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大麻栽培で組員２人逮捕…工藤会、売り上げ１億円か
福岡県警は１０日、大麻取締法違反（営利目的栽培）の疑いで、いずれも指定暴力団工藤会長谷川組組員の、３２歳と２８歳の男２人を逮捕した。
県警は茎だけになった大麻草約１４０株を押収、葉は乾燥大麻にして販売され１億円以上の売り上げがあったとみている。このほか乾燥大麻約１キロや、２００６年からの栽培日誌、市販の大麻栽培マニュアル本のコピーなど約５００点も押収した。
調べでは２人は共謀し５月、３２歳の男の家で大麻草１０６株を栽培するなどした疑い。いずれも容疑を認めているという。
県警は資金源獲得のための組織的密売の可能性があるとみて入手経路を追及、首謀者とみられる同組幹部の行方を追っている。
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近代金貨：３万２６８０枚売却、５７億円の収入 財務省
財務省は１０日、明治以降に発行された近代金貨のうち政府が保有していた３万２６８０枚をすべて売却し、計５７億３９３１万円の売り上げがあったと発表した。最高値を付けたのは１８８０（明治１３）年に発行された旧２円金貨で、売却額は１枚で３２１０万円だった。収益は全額、国の一般会計に計上され、国の歳入不足を補う。
売却したのは１８７０（明治３）年から１９３２（昭和７）年に発行された額面１、２、５、１０、２０円の金貨。戦後、連合国軍総司令部（ＧＨＱ）に接収されていたが、５２年のサンフランシスコ講和条約の発効と同時に政府に返還された。
その後、約半世紀にわたり財務省が保管してきたが、財政再建の一環として放出を決定。０５年から競売会やインターネットを通じ売却を進めてきた。
最高値となった明治１３年の旧２円金貨は、８７枚しか発行されなかった「幻の金貨」。政府の放出品は傷や光沢の劣化がほとんどなく、オークションの結果、事前の落札予想価格２０００万円を大幅に上回る価格で競り落とされた。
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自宅宿舎で大麻栽培…大津の国交省職員逮捕
近畿厚生局麻薬取締部は９日、大津市内の自宅官舎で大麻草を栽培していたとして、国土交通省近畿地方整備局大戸川ダム工事事務所の用地課主任・藤田健司容疑者（４３）を、大麻取締法違反の現行犯で逮捕した。藤田容疑者は３Ｋの間取りのうち１室を、栽培部屋として利用。「神経症」や「不安障害」のため休職を繰り返す一方で、自宅では妻（３６）とともに大麻を育て、吸引していた。
麻薬取締部によると、藤田容疑者は小さな台所と３つの部屋がある一戸建ての官舎の中で、四畳半の洋間を栽培専用に利用していた。この日午前７時、同部が捜索に入った部屋は、雨戸が閉め切られ、アルミシートに囲まれた鉢植えの大麻草５５本が床の半分を占め、蛍光灯に照らされている状態だったという。自宅からは吸引の残りかすなども発見された。
捜査員から「何で来たか分かるか？」と問われ「すみません、そこにあります」と、うなだれて大麻部屋を示したという藤田容疑者。調べに対し「２年ぐらい前から栽培していた。官舎で自分でも吸っていた」と供述。大麻草はこれまでに２回収穫。「インターネットで種を買った」とも話しており、同部は入手先を追及、大戸川ダム工事事務所も捜索する方針だ。
藤田容疑者は栽培を始めたきっかけを「雑誌をみたら幻覚が見えることを知って興味を持った」と供述。用地課主任として「ダム用地の買収などでストレスがたまっていた時期でもあったようだ」（同部）。１９９０年に採用後、２００５年から現在の勤務先で働いたが、０７年からは「神経症」「不安障害」で２回休職、今年１月に復職後は午前の勤務だけだった。
ただし勤務先の大戸川工事事務所などによると、藤田容疑者の仕事でのストレスは「考えられない」という。工事は０５年から一時休止しており、容疑者は「用地の買収には直接タッチしていない」。復職後も締め切りや納期のある仕事ではなく、買収済みの用地の見回りなどを任されていた。
休職期間中以外も「気分が悪い」「動悸が激しい」等の理由で仕事を休む日があったが、無断欠勤はなし。体調が悪いのも周囲は「薬の副作用」と考えていた。８日も体調不良で仕事を休んだが、職場では「また症状が出たんだな」と解釈。自宅での大麻栽培を知り「職場はみんなビックリしている」と話した。
藤田容疑者は官舎に妻と２人暮らし。かつて留学先の米国で大麻を吸ったことがあるとしている妻も一緒に吸引していたという。
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自宅官舎で大麻草栽培 国交省主任を逮捕 「妻と吸った」
2008.7.9 13:40
国土交通省近畿地方整備局の主任が大津市内の自宅官舎で大麻草を栽培していたとして、近畿厚生局麻薬取締部は９日、大麻取締法違反（栽培）の現行犯で大津市一里山、同整備局大戸川ダム工事事務所用地課主任、藤田健司容疑者（４３）を逮捕した。調べに対し「密売人から買うと捕まる可能性があるので、２年前から自分で栽培を始めた。これまでに２回収穫し、妻と一緒に吸っていた」と供述しているという。
調べでは、藤田容疑者は９日、大津市の自宅官舎で大麻草５５本を栽培していた疑い。麻薬取締部が同日朝、家宅捜索し、大麻草を発見した。麻薬取締部は、大麻の使用状況などについても調べるとともに、大麻草の種子の入手経路などを追及する。
藤田容疑者は平成２年、同整備局に採用され、１７年４月から大戸川ダム事務所で買収済み用地の管理業務などに従事していた。同事務所によると、最近は休みがちで、今月に入ってからはほぼ１日おきの勤務だった。８日朝に本人から欠勤の連絡があったが、９日は朝から連絡が取れていなかったという。
木下誠也・近畿地方整備局長の話 「職員が逮捕されたことは国家公務員の信頼を傷つける行為であり、極めて遺憾。事実関係について確認し、厳正な措置を講じるとともに改めて綱紀の保持を徹底したい」
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Spokesman: Gazprom in talks with Total on cooperation in Iran
MOSCOW, Jul 10 (Prime-Tass) -- Russia’s natural gas monopoly Gazprom is “indeed in talks” with France’s Total on cooperation in Iran, Gazprom spokesman Sergei Kupriyanov confirmed in an interview Thursday with the radio station Ekho Moskvy (Echo of Moscow).
However, he declined to provide details, or say whether the talks are about developing the South Pars gas field.
Kupriyanov also said it was early to speak about the amount of investments in Iran.
Kupriyanov’s remarks followed comments from Christophe de Margerie, Total’s chief executive, who told the Financial Times late Wednesday that the company considers it too risky to invest in Iran, making it highly unlikely the group will invest in a liquefied natural gas project linked to South Pars in the near future.
de Margerie's comments come as tensions increase between Iran, the U.S. and Israel over Tehran's nuclear ambitions. Iran this week test-fired missiles capable of reaching Tel-Aviv and it has threatened to respond with massive retaliation to any Israeli or U.S. military strike.
Gazprom has participated in the second and third stages of the South Pars field development since 1997 together with Total.
In February, Alexei Miller, Gazprom's chief executive, and Iranian Oil Minister Gholam Hossein Nozari agreed on the Russian company's participation in the development of two or three blocks of South Pars, and the talks are ongoing.
Gazprom's oil subsidiary Gazprom Neft is in talks with Iranian officials on possible cooperation in developing oil fields in Iran's Northern Azadegan region.
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Total steps back from investing in Iran
By Carola Hoyos in London and Daniel Dombey in Washington
Published: July 9 2008 23:34 | Last updated: July 9 2008 23:34
Iran has lost the last major western energy group that had been considering making a significant investment to develop the country’s huge gas reserves in a victory for Washington’s efforts to isolate Tehran over its nuclear ambitions.
Total, the French energy group, told the FT it was now too risky to invest in Iran, making it highly unlikely that the group will invest in a liquefied natural gas project linked to Iran’s South Pars gas field in near future.
The comments from Christophe de Margerie, chief executive, follow weeks of increasing tensions between Iran and Israel. On Wednesday, Tehran test-fired nine missiles and warned that it would provide massive retaliation to any military strike.
The US has also stepped up its push to impose tougher sanctions on Tehran in the dispute over Iran’s nuclear programme.
Mr de Margerie said: “Today we would be taking too much political risk to invest in Iran because people will say: ‘Total will do anything for money’.”
Together with Malaysia’s Petronas, Total was due to develop phase 11 of the South Pars field and had until Wednesday maintained it had not decided to drop its interest in the project. After May’s announcement that Royal Dutch Shell and Repsol YPF of Spain would pull out of Phase 13, Total was left exposed.
Total’s move is a big blow for Iran, which is now unlikely to be able to significantly raise its gas exports until late in the next decade at the soonest. Samuel Ciszuk, Middle East energy analyst at Global Insight, called Total’s decision “a death blow” for Iran’s LNG ambitions, because the country would now be unable to gain the knowhow it needed for such complex projects, even if it teamed up with Russia or China.
None of the western oil companies including Total is willing definitively to close the door on Iran’s massive hydrocarbon reserves. Shell and Repsol said they could still join later stages of the development of the field.
In a further sign of the increased scrutiny over investments in Iran’s energy sector, William Burns, the US state department’s top official on Iran, told a US congressional committee on Wednesday that Washington would conduct a “serious review” to see whether the Norwegian group StatoilHydro had violated US law by carrying out a large investment in Iran.
Washington had been particularly worried about Total, and US officials concede measures affecting the transfer of western investment and knowhow to Iran’s energy sector have a much greater impact than do financial sanctions. But Mr de Margerie voiced his anger at the policy, saying: “You take two major countries [Iran and Iraq] out of the system and then you say: ‘There is not enough oil and gas.’ Oh no, surprise, surprise.”
Wednesday’s test firing left the oil market unfazed, with oil prices failing to make up recent losses and trading at $136.20 a barrel.
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Russia’s Gazprom may participate in the construction of a gas pipeline from Libya to Europe
09.07.2008, 19.05
MOSCOW, July 9 (Itar-Tass) -- Russia’s Gazprom may participate in the construction of a gas pipeline from Libya to Europe and start buying Libyan hydrocarbons, Gazprom said on Wednesday after talks held in Libya by between the company’s delegation led by CEO Alexei Miller.
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Gazprom could obtain Ukrainian oil firm's licenses in Libya
12:52 | 10/ 07/ 2008
KIEV, July 10 (RIA Novosti) - Russian energy giant Gazprom [RTS: GAZP] could obtain licenses to oil and gas deposits in Libya previously offered to Ukraine's national company Naftogaz Ukrainy, a business paper said on Thursday.
According to Kommersant Ukraine, Naftogaz Ukrainy and Libya's National Oil Corporation signed a production sharing agreement in October 2004 on four deposits with estimated reserves of around 110 million metric tons (806 million barrels) of oil and 30 billion cubic meters of natural gas.
The deal specified that Naftogaz would invest a minimum of $57.5 million in prospecting. However, the Ukrainian company has only invested a mere $16 million to date and suspended the development of deposits from early 2008, the paper said.
Gazprom CEO Alexei Miller held a meeting with Libya's leader Muammar Qaddafi on July 9 to discuss the possibility of "developing a mutually advantageous long-term partnership between Gazprom and the energy-rich North African country," the paper said.
In particular, Miller offered to buy all of Libya's natural gas, oil and liquefied natural gas exports at competitive prices, the paper said.
A high-ranking source in the Ukrainian fuel and energy ministry told the paper that at yesterday's talks Libya offered Gazprom three of the four oil and gas fields previously offered to Naftogaz.
Naftogaz and Gazprom have declined to comment on this information, the paper said.
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税務署、電子申告数水増し １４００件署員自ら入力
2008年7月10日3時1分
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東京都や大阪府、広島県などにある１０税務署で、署員らが、納税者本人が利用することになっている署内のパソコンの「国税電子申告・納税システム」（ｅ―Ｔａｘ）を使い、本人の申告情報を入力・送信していたことが分かった。結果として、ｅ―Ｔａｘの利用率を内部で水増ししていたことになる。本人不在の「趣旨に反した利用」（国税庁）は全国で約１４００件あったという。
ｅ―Ｔａｘは、自宅やオフィスからインターネットを利用して確定申告などができるシステム。普及に努める同庁は０８年から、税務署に来た納税者に署内のパソコンでｅ―Ｔａｘの利便性を体験してもらい、その翌年から自宅などで利用するように誘導する「初回来署型電子申告」を導入。この方法による申告もｅ―Ｔａｘの利用件数に含めることにした。
国税庁によると、問題があったのは東京国税局の７税務署と、大阪、広島、熊本の各国税局の１署ずつ。個人事業者らの納税者団体「青色申告会」の会員が同会に提出した申告書の控えなどを基に、本人不在の状況で、税務署員や同会の事務局員が署内のパソコンで入力・送信していた。署員らが残業したり、操作研修として入力・送信したりした署もあったという。
４月に問題が発覚し、国税庁は全国調査を実施。各税務署に「初回来署型電子申告の導入趣旨に反する」と注意したが、「青色申告会を通じて納税者本人の同意を得て申告内容を正しく入力しており、文書偽造などの法令違反には当たらない」として処分や公表はしなかった。
政府は国への申請・届け出などのオンライン利用率の目標を「１０年度までに５０％以上」としており、国税庁も０６年度に３％だったｅ―Ｔａｘ利用率の目標を１０年度５０％に設定している。
今年５月末、国税庁は水増し分をｅ―Ｔａｘの件数から除いて０７年分の確定申告状況を発表。それによると、ｅ―Ｔａｘを利用した所得税の申告は前年の７．４倍の約３６３万４千件、利用率は１５．７％に達したが、そのうちの約１９２万６千件は初回来署型だった。
国税庁の岸英人個人課税課長は「初回来署型の導入趣旨にそぐわず不適切な事例があった。二度と起こらないように全税務署に周知徹底した」と説明している。
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Fannie and Freddie tumble
By Saskia Scholtes in New York
Published: July 8 2008 03:00 | Last updated: July 8 2008 03:00
Shares in Fannie Mae and Freddie Mac plunged yesterday as investors worried that the two giant government-sponsored mortgage financiers would have to raise fresh capital.
Fannie and Freddie shares were down by as much as 26 per cent and 29 per cent, respectively, at the peak of the sell-off after a Lehman Brothers analyst said an accounting change could, in theory, force the two biggest US mortgage financiers to raise an additional $75bn in capital.
The Lehman analyst, Bruce Harting, said he believed Fannie and Freddie would be exempt from the accounting rule,. However, the sharp market reaction to his report highlighted the continuing worries about the breadth and depth of the credit crunch.
Fannie and Freddie finished the day off 16.2 per cent and 17.9 per cent, respectively.
Regional bank stocks also suffered sharp losses amid growing concerns about mounting losses on residential construction loans.
Lehman said changes under discussion at the Federal Accounting Standards Board could force Fannie and Freddie to bring mortgages they have securitised back on to their balance sheets and incur a total of $75bn of regulatory capital charges.
"It's in no one's interest for the GSEs to be saddled with overwhelming capital requirements at a time when the market needs [them] to buy mortgages," wrote Mr Harting.
The report aggravated poor investor sentiment towards Freddie in particular, which is still to complete a $5.5bn capital-raising it announced in May.
Marshall & Ilsley, a regional bank based in Wisconsin, fell by as much as 13 per cent yesterday after saying last week that it would take a second-quarter loss and put aside provisions of up to $900m for loan losses.
Marshall & Ilsley's problems prompted more concern over banks such as SunTrust, First Horizon and Washington Federal, which have significant exposure to residential construction loans.
As small homebuilders and developers struggle in the housing slump, banks such as Marshall & Ilsley are increasingly left with construction sites and land loans worth between 5 cents and 70 cents on the dollar, according to Paul Miller, analyst at Friedman, Billings, Ramsey.
Shares of Atlanta-based SunTrust were down by 9.1 per cent at the close of trading yesterday, while First Horizon was off by 11.3 per cent, and Washington Federal lost 7.8 per cent.
IndyMac, one of the largest US mortgage lenders, said it would cut 3,800 jobs - or 53 per cent - and stop making most home loans after regulators said it was no longer "well capitalised".
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Overview: Financials diverge sharply either side of Atlantic
By Dave Shellock in London and Michael Mackenzie in New York
Published: July 9 2008 20:33 | Last updated: July 9 2008 22:11
US and European financial stocks diverged sharply on Wednesday and dictated a stark contrast in the performance of equity markets on either side of the Atlantic.
While european equity markets rallied strongly, Wall Street slumped in afternoon trade as financials, notably Fannie Mae, and Freddie Mac, the Government sponsored mortgage agencies, fell sharply.
Further distress among financials sparked renewed buying of Treasury debt and further weakness for the dollar against the yen.
Dominic Konstam, head of interest rate strategy at Credit Suisse said: “Some people are very pessimistic on the agencies.” He added, that equity investors are waking up to the fact that the stock price of many financials has fallen so much, that is becoming difficult for them to raise sufficient capital.
In New York the S&P 500 index closed 2.3 per cent lower and officially entered bear market territory, as it has fallen more than 20 per cent from its high in October.
In contrast, banking stocks led the way in Europe as the sector rebounded on positive comments made by US regulators and bankers on Tuesday.
The FTSE Eurofirst 300 index climbed 1.7 per cent as the bank sub-index jumped 3.2 per cent. The FTSE 100 in London rose 1.6 per cent.
Asian stock markets were mixed, with the Nikkei 225 Average in Tokyo trimming a strong early advance to close just 0.2 per cent higher. South Korean stocks also slipped back, although Hong Kong rose 2.8 per cent and Shanghai jumped 3.8 per cent.
Strategists remain cautious about the outlook for global stocks. Binit Patel and Salman Ahmed at Goldman Sachs said: “The market is in the process of adapting expectations to a less optimistic view of the macro environment. And what looks cheap now may not look that cheap in the near future, should fundamentals turn even less friendly.”
Credit spreads tightened in Europe, but early gains in the US lost steam as stocks slumped.
Gavan Nolan, vice-president of credit research at Markit said: “Deterioration in asset quality is now the main issue facing banks, an area where monetary authorities have limited influence.”
Nonetheless, the iTraxx Europe investment-grade index dipped below the 100 basis point level for the first time in two weeks. It closed at 109.5bp on Tuesday. In the US, the CDX North America index moved out to 142bp after touching 137bp in early trade.
In the money markets, the overnight Libor euro rate jumped 47bp as the European Central Bank’s higher refinancing rate came into effect. Three-month euro, sterling and dollar rates saw much more modest moves.
Jean-Claude Trichet, the president, took a more hawkish line on Wednesday on policy after signalling no bias towards rates last week.
His remarks pressured European government bonds. The yield on the rate-sensitive two-year Schatz rose 3bp to 4.43 per cent and the 10-year Bund yield edged up 1bp to 4.42 per cent.
The two-year UK gilt yield was flat at 4.89 per cent ahead of Thursday’s Bank of England interest rate decision – with most analysts expecting borrowing costs to be left on hold.
John Higgins at Capital Economics noted that investors had recently scaled back their expectations of tighter monetary policy, which had followed strong inflation and retail sales data last month.
US Treasury bonds rallied in afternoon trade and the 10-year yield fell 6bp to 3.82 per cent. The two-year note was trading at 2.37 per cent late in New York, down from an early high of 2.54 per cent.
In commodities, oil just snapped a two-day decline as geopolitical tensions were ratcheted up by news that Iran had test-fired missiles. Prices were also helped by data showing a bigger-than- expected drop in US crude supplies last week. After rallying much higher in early trade, US light crude closed a cent higher $136.05 a barrel, after suffering its biggest two-day decline since mid-March on Monday and Tuesday.
On the currency markets, the early oil price rally and then weak stocks helped drive the dollar down almost across the board. The dollar was also dented by the fact the communiqué from the G8 meeting had failed to address its weakness.
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