New Currency Requires To Obsecurity Of Financial Market

A paper written ahead of the recent G20 summit by Zhou Xiaochuan, governor of the Chinese central bank, caused quite a stir. Zhou called for the establishment of a global reserve currency, a step which would firmly tip the balance of economic power in the direction of emerging economies like China and India, but would also bring benefits to poorer nations in the developing world.

The dollars role in international trade should be reduced by establishing a new currency to protect emerging markets from the confidence game of financial speculation, the United Nations
said.

Two very obvious changes have prompted this reaction: First, there is a growing recognition that
the course towards the current crisis was plotted when President Nixon severed the link between the dollar and gold in 1971. Second, the fact that, quite unlike any president before him, not only does Barack Obama believe in a more just and inclusive world, he also seems to recognise that creating such a world requires some levelling of the global economic playing field. The creation of a global reserve currency would be an essential first step in that process.

UN countries should agree on the creation of a global reserve bank to issue the currency and to
monitor the national exchange rates of its members, the Geneva-based UN Conference on Trade and Development said on Tuesday in a report.

China, India, Brazil and Russia this year called for a replacement to the dollar as the main reserve currency after the financial crisis sparked by the collapse of the US mortgage market led
to the worst global recession since World War II. China, the world's largest holder of dollar reserves, said a supranational currency such as IMF's special drawing rights, or SDRs, may add
stability.

There's a much better chance of achieving a stable pattern of exchange rates in a multilaterally-agreed framework for exchange-rate management, Heiner Flassbeck, co-author of the report and a UNCTAD director, said. An initiative equivalent to Bretton Woods or the European Monetary System is needed. The 1944 Bretton Woods agreement created the modern global economic system and World Bank and IMF.

While it would be desirable to strengthen SDRs, a unit of account based on a basket of currencies,
it wouldn't be enough to aid emerging markets most in need of liquidity, said Flassbeck, a former
German deputy finance minister who worked in 1997-1998 with then US Deputy Treasury Secretary Lawrence Summers to contain the Asian financial crisis.

Emerging-market countries are underrepresented at the IMF, hindering the effectiveness of enhanced SDR allocation. An organization should be created to manage real exchange rates between countries measured by purchasing power and adjusted to inflation differentials and development levels, UN said. The most important lesson of the global crisis is financial markets
don't get prices right, Flassbeck said.

The Trillion Dollar Deadline

How will companies pay for the mountain of dodgy debt maturing soon?

Nearly $1 trillion in risky debt comes due from 2011 to 2015, and even if the credit crunch is long past, companies will likely struggle to refinance it says CreditSights. Expect to see more battles like the current one between General Motors and its creditors.

It’s not just the size of the looming maturities that poses a problem. The central issue is that many of the buyers who helped build the mountain of debt have disappeared. The shadow banking system, the mix of hedge funds and structured investment vehicles, has collapsed, writes Chris Taggert, analyst at the credit research company. Companies with junk debt will have to fight with sturdy, investment-grade companies for survival.

Part of the blame lies with private equity firms like the Blackstone Group and Apollo Management. During their heyday, they bought companies by loading them up with debt. Those bank loans and bonds were sold to other investors, such as hedge funds and collateralized loan obligations that often borrowed to buy them. The days are gone “when one real dollar could easily buy $5 or more dollars of leveraged finance debt,” Taggert writes. Many maturities will come from these companies whose capital structures were layered with debt in 2006, during “the peak of the credit craze.”

Some $936 billion in high-yield bonds and loans will come due from 2011 to 2015. That’s 96% of all leveraged loans and 59% of the entire junk-bond index, CreditSights says.

As a result, there will likely be a rise in fights between creditors and companies similar to the current battle over General Motors debts. Debt swaps, in which companies offer to buy back debt at a steep discount, are suddenly popular with companies trying to escape bankruptcy.

Another $176 billion in credit lines also fall due between 2010 and 2015. Banks are likely to cut credit lines further as long as the economy slumps, much as Bank of America and others have for their credit card holders. Smaller lines of credit can have a ripple effect, Taggert writes: companies push to extend their debt and shorten due dates on what’s owed them. 

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Intel's Pain Party !

The worse the economy gets, the faster the chip giant plans to move.

BURLINGAME, Calif. -- The economy is in the tank. PC sales are in a funk. And Intel shares have lost more than a third of their value over the past year. So why is Stacy Smith, the chip giant's chief financial officer, smiling?

Hey, you would too if you had $3.5 billion in cash, $4.2 billion in short-term securities, a business with a gross margin of 46% after getting hammered by a recession and a plan to spend billions to upgrade your factories to crank out better products. Sales, meanwhile, are better than they were. "The best sign is what's happening on our order desk," Smith says.

In short, we've now reached the moment the dudes at Intel live for : an opportunity to push forward as competitors are struggling to catch their breath.

Intel's management team will get a little bit of vindication, too, when they invite investors to Santa Clara, Calif., for the company's analyst day next month. Last year, Intel was selling skeptics on the need to begin selling radically cheaper processors. 

Twelve months and one stock-market collapse later, Intel's plan looks smart. Sales of PCs have nosedived, but consumers are snapping up the cheap, Web-friendly notebooks ASUS, Hewlett-Packard and Dell are building around Intel's Atom. "The netbook phenomenon even caught us a little by surprise," Smith says.

Still, after Intel successfully called its shot last year, investors will be paying close attention as Smith outlines this year's big bet--and it's a doozy. Intel plans to spend roughly $7 billion to upgrade its fabs this year, allowing it to crank out processors with features 32 nanometers wide. 

If demand is strong, that could allow Intel to command a premium price for chips built using a process technology its competitors can't match. If demand fades, Intel will take more fabs offline so they can upgrade them to the new process technology more quickly.

In other words: The tougher the economy gets, the tougher Intel gets. "We're going to move as fast as possible to get as much of our capacity as possible on 32 nanometers."

And that will only help Intel move more quickly to its next big opportunity. The plan: shrink the x86 processor design now powering servers and desktop computers enough to assault the market for mobile phones, unlocking a market for Intel many times the size of the netbook market it has conquered.

To be sure, Smith says Intel's push into the smart-phone market will look very different than its drive into netbooks. Intel was able to swallow most of the netbook market in a single gulp, since its Atom processor was able to deliver, almost immediately, the power and energy efficiency needed to run the scaled-down notebook computers.

With smart phones, by contrast, Intel's processors won't play in the entire market at the same time. Intel's strategy hinges on using its process technology to shrink its powerful chips down to a smaller size, making them cheaper and more energy efficient.

So while Intel will begin nibbling at the high end of that market by year-end, it will have to wait two years until it begins cranking out processors with features just 22 nanometers wide for more mainstream phones.

That will give Intel's competitors time. Shares of rival Advanced Micro Devices, for example, have rebounded sharply this year after it shed its capital-sucking chip fabs. Samsung, Texas Instruments and the pack of companies building processors for mobile phones based on ARM's mobile processor designs, meanwhile, are poking into the market for netbook computers.

The worse the economy gets, however, the faster Intel will shrink its processors, and the less money competitors will have to keep up. "Making those investments into the downturn is a huge competitive advantage, and it's one our competitors can't make," Smith says.

So, what can Intel's competitors do? Hope the economy gets better. Fast.

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Top 5 Sexiest Jobs That Attract Women

We all want those really high-powered, super cool, crazy paying jobs that attract the ladies. Unfortunately most of those occupations come with tremendous amounts of pressure and stress which can keep you from enjoying all the women you should be getting because of your title. Here are a few career paths you may want to consider if you're more interested in scoring than you are in working hard, worrying, or contributing anything to society.  

Also, let us know if you have something new coolest jobs in your mind that can attract women ....

PLAYING FOR THE WASHINGTON NATIONALS

In a 2007 poll conducted by Career Builder.com, "professional athlete" came in third among the 10 sexiest jobs. Although professional athletes usually have to deal with extreme levels of pressure created by their fans and the media, there are some exceptions—like playing for the Washington Nationals. Fewer jobs in professional sports come with lower expectations than playing for D.C.'s resident toxic asset. They're a lock for last place every year and you'll rarely cross home plate on the field, but you'll be scoring left and right when you're off it. Finding someone who doesn't want to round the bases with a professional athlete is even harder to find than a "die hard" Nationals fan. 

PERSONAL TRAINING

Although "doctor" often tops many sexiest job lists, it would definitely rank near the bottom of any low-stress babe magnet career list because, despite all the golfing, you're occasionally responsible for saving lives. You also need to bust your hump for eight years in medical school just to open up shop, and you'll constantly have the specter of a malpractice suit hanging over your head. If you're looking for a career as a health practitioner, consider being a personal trainer. It's a profession which has appeared on multiple sexiest job polls with a hell of a lot less stress, but nearly equal babe-pulling qualities. As long as you don't consider standing around and counting all day particularly stressful activities, you should be able to score loads of undisciplined, middle-aged, neglected housewives and divorcées with this mind-softening gig.

COWBOY

When was the last time you saw a cowboy at a bar complaining about meeting a deadline or his pain in the ass boss? Actually, when was the last time you even saw a real cowboy, period? Who even knew America had cowboys anymore? The ladies, that's who. According to Salary.com the childhood dream job of "cowboy" made the cut as one of the top ten sexiest occupations. For lots of fresh air, a cool sounding job title, and more ass than you can shake a Stetson at, look to the wild, wild west for a beneficial career change.

TV PERSONALITY/METEOROLOGIST

It's no surprise that "TV personality/news anchor" showed up on Career Builder's sexy job list. You just can't underestimate the impact that being on television everyday has on women. Being a news anchor will undoubtedly be a turn-on for some ladies, but others might shy away from someone whose job is to deliver economic doom-and-gloom 24/7. (You'll also be required to—gasp—pay attention to the news.) 

Which is why we'd advise to go the even easier route: TV weatherman. Think about it: What other gig pays handsomely, but has zero repercussions for being completely wrong all the time? The dude who says it'll be sunny, only to misread weather patterns and miss that tornado heading for your town—that's who. The best part of this job is if you blow off checking out the readings on the Doppler radar because of the wild threesome with weather groupies the night before, it's no big deal. You could always just look out the window and take a shot at the forecast. No one's expecting you to be right anyway.  

BARTENDER

In 2007, "bartender" was voted the sexiest occupation across the board for both men and women. How could it not be? Night after night, you're standing behind the dimly lit bar in a position of power surrounded by horny people who are finding you more and more attractive as you load them up with drinks. Even better, it's usually louder than Don Cherry's wardrobe at most bars, so you won't need to put together coherent sentences to impress the females. Just smile, mutter something about them being hot, and nod your head. They'll eat it up! If you can deal with the anxiety of trying to remember the difference between a Bay Breeze and a Sex on the Beach, this job should have you sleeping late, making off-the-books cash money, and tapping a lot more than just kegs. 

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Top 10 Technology Kings Of Cash

When the economy gets ugly, nothing talks like cash in the bank. Although banks and car companies may be pretty much screwed right now, IBM, Hewlett-Packard and other big tech companies are rolling in greenbacks. Check out the list and suggest some more info's you need to be here..

1. IBM

Armonk, N.Y.

Cash and Equivalents : $12.7 billion

2 . Hewlett-Packard [ HP ]

Palo Alto, Calif.

Cash and Equivalents : $11.2 billion

 3. Google

Mountain View, Calif.

Cash and Equivalents : $8.7 billion

4. Dell

Austin, Texas

Cash and Equivalents : $8.4 billion

5. Microsoft

Redmond, Wash.

Cash and Equivalents : $8.3 billion

6. Oracle

Redwood City, Calif.

Cash and Equivalents : $7.4 billion

7. Apple

Cupertino, Calif.

Cash and Equivalents : $7.2 billion

8. EMC

Hopkinton, Mass.

Cash and Equivalents : $5.8 billion 

9. Cisco Systems

San Jose, Calif.

Cash and Equivalents : $4.2 billion

10. Intel

Santa Clara, Calif.

Cash and Equivalents : $3.4 billion

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Barack Obama's Economic Optimism Falls On Deaf Ears

President Barack Obama spoke of seeing "glimmers of hope" in the economic outlook for the first time since the current downturn began, while Federal Reserve chairman Ben Bernanke said he was witnessing "tentative signs that the sharp decline in economic activity may be slowing".
But the pair's comments, coming on the same day as worse-than-expected retail sales and inflation figures, did little to revive investors. The Dow Jones Industrial Average index traded down 137.63 points at 7920.18 on Wall Street.

Barack Obama's words failed to boost Wall Street as the Dow Jones Industrial Average index traded down

The speeches came days after Larry Summers, the President's most senior economic adviser, suggested that America's economic "free-fall" is coming to an end.

Although the Fed remains independent of the Obama administration, the three speeches, coming in such quick succession, appear to be part of an orchestrated campaign by the White House to forge a positive attitude among the population.

Coming in a month when tens of millions of Americans will begin to receive several thousand dollars in tax rebate cheques, it appears that the White House is trying to kick-start the economy by encouraging consumers to return to spending, rather than continuing to hoard savings.

The need for such a strategy was highlighted in March's retail sales figures, which showed a 1.1pc decrease in total sales, a surprise to economists who had been forecasting a 0.3pc increase.

Goldman Sachs' chief US economist Jan Hatzius said the report puts "consumption on a weak path into the second quarter", noting that electronics sales were down by 5.9pc.

Retail sales are key as consumers account for two-thirds of the US economy.

Headline producer prices also fell, by 1.2pc month-on-month. The decline was concentrated in energy and food prices, due to weakening demand and, for energy, pipeline pressures.

But the negative economic data did not stop Mr Obama from appearing positive during a speech on the efforts taken to revive the American economy.

"There is no doubt that times are still tough" he said. "By no means are we out of the woods just yet. . . But from where we stand, for the very first time, we are beginning to see glimmers of hope."

Mr Bernanke based his assessment of the economy on recent positive data from the housing and other markets, but stressed that this is still the worst financial crisis since the Great Depression.

"A levelling out of economic activity is the first step toward recovery," Mr Bernanke said, adding that he is "fundamentally optimistic" about the US economy, the foundations of which he believes remain "strong".

But not everyone agrees. With reference to Mr Bernanke's comments last month about the "green shoots" of recovery, Ethan Harris, Barclays Capital's co-head of US economic research, said: "The green shoots are looking a little brown."

Source : http://www.telegraph.co.uk

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Jobless Could Hit 4 Million - Predicts Bank Adviser

Unemployment could double to four million unless the Government takes drastic action to boost public spending and create new jobs, a Bank of England official has warned.

In a dire outlook, Monetary Policy Committee member David Blanchflower also said the recession could be deeper and longer than the Bank previously predicted.

He added that the Government needed to tackle the soaring numbers of young people out of work by raising the school leaving age sooner and pushing more people into higher education.

Doom and gloom: The Bank of England's predictions that UK output would tumble 3.5 per cent could prove 'too optimistic'.

Speaking at a Westminster conference, Mr Blanchflower called for the Treasury to launch a near-£90billion fiscal stimulus, including tax cuts and investment in new schools and hospitals. This would help create 750,000 new jobs, he said.

'This is not about people being lazy,' he added. 'There aren't jobs. In six months this is going to be the biggest issue in every MP's constituency.'

David Blanchflower says the recession could be deeper and longer than initially expected..

Mr Blanchflower has proved one of the most prescient members of the MPC, calling for interest rate cuts a year before the rest of the committee.

Last summer he forecast unemployment would hit two million by Christmas - a prediction that was fulfilled in January.

Last month the Bank of England predicted UK output would tumble 3.5 per cent this year, before recovering 1.2 per cent in 2010.

But this is likely to prove too optimistic, Mr Blanchflower said yesterday. As a result, predictions that jobless ranks will peak at three million are also likely to be too rosy.

'(With) any forecast of unemployment and output, the likelihood in a recession is we have undercooked it,' he told MPs. A surge in unemployment to four million would mean the total surpassing the heights reached in the deep recession of the 1980s, when joblessness peaked at nearly 3.3million.

Mr Blanchflower's fiscal stimulus plan includes 'large cuts' in income taxes and national insurance contributions for the lowpaid and young people.

In a paper co-written with David Bell of the University of Stirling, he said the Treasury should plough billions into construction projects by health authorities, universities and housing associations.

The raising of the education leaving age to 18 should be brought forward to this year to prevent legions of school leavers seeking jobs when there are few available.

This summer more than 600,000 people will leave schools and universities and embark on a desperate search for work. Already 40 per cent of the unemployed are under 25.

Mr Blanchflower said young people's entire lives would be affected if they were unable to find work now.

Honda workers to get pay cut

Carmaker Honda is asking its workers to accept a pay cut for at least a year to ensure the survival of its UK factories.

The Japanese firm is sending letters to 3,600 workers at its Swindon plant stressing the dire state of car manufacturing.

The letters do not state the size of the cut, but a similar arrangement at Toyota has seen both working hours and pay cut by 10 per cent at its two UK plants.

The average wage for lineworkers is around £22,000. The Unite union said negotiations were yet to be held on the issue.

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Global Economy Set To Shrink, India Loses Half A Million Jobs

With over half a million jobs lost in India alone in recent months, the World Bank predicts the global economy and global trade would both shrink this year for the first time since World War II.

While the global economy is likely to grow at least 5 percentage points below potential in 2009, world trade is on track to record its largest decline in 80 years - with the sharpest losses in East Asia.

World Bank forecasts show that global industrial production by the middle of 2009 could be as much as 15 percent lower than levels in 2008, it said in a paper for next Saturday's meeting of the Group of 20 finance ministers and central bank governors.

Developing countries face a financing shortfall of $270-700 billion this year, as private sector creditors shun emerging markets, and only one quarter of the most vulnerable countries have the resources to prevent a rise in poverty.

The paper said that 94 out of 116 developing countries have experienced a slowdown in economic growth. Of these countries, 43 have high levels of poverty.

To date, the most affected sectors are those that were the most dynamic, typically urban-based exporters, construction, mining, and manufacturing.

For example, 'more than half a million jobs have been lost in the last three months of 2008 in India, including in gems and jewellery, autos and textiles,' the paper noted.

Many of the world's poorest countries are becoming ever more dependent on development assistance as their exports and fiscal revenues decline because of the crisis.

Noting that donors are already behind by around $39 billion on their commitments to increase aid made at the Gleneagles Summit in 2005, the bank said: 'the concern now is that aid flows will become more volatile as some countries cut their aid budgets while others reaffirm aid commitments, at least for this year.'

The World Bank said that international financial institutions cannot by themselves currently cover the shortfall-that includes public and private debt and trade deficits-for these 129 countries, even at the lower end of the range.

A solution will require governments, multilateral institutions, and the private sector. Only one quarter of vulnerable developing countries have the ability to finance measures to blunt the economic downturn, such as job-creation or safety net programs.

'We need to react in real time to a growing crisis that is hurting people in developing countries,' said World Bank Group President Robert B. Zoellick.

'This global crisis needs a global solution and preventing an economic catastrophe in developing countries is important for global efforts to overcome this crisis.

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Economic Depression Directly Proportional To Unsold Cars

The title is significant due to collapse in global sales and Economic depression the number og unsold cars increases day by day .. Check out the list of companies with the number of unsold cars by scrolling down .

Nissan has announced plans to cut its Sunderland workforce by 1,200. Thousands of unsold cars are stored around the factory's test track.

Honda is halting production at its Swindon plant in April and May, extending the two-month closure announced before Christmas to four months. Honda and Japanese rival Toyota are both cutting production in Japan and elsewhere. Pictured, Hondas await export at a pier in Tokyo .

Earlier this week Jaguar Land Rover said 450 British jobs would go .

The open car storage areas in Corby , Northamptonshire, are reaching full capacity.

mported cars stored at Sheerness open storage area awaiting delivery to dealers .

Newly imported cars fill the 150-acre site at the Toyota distribution centre in Long Beach , California .

The build-up of imported cars at the port of Newark , New Jersey

Stocks of Ford trucks in Detroit , Michigan .

New cars jam the dockside in the port of Valencia in Spain .

Peugeot cars await shipment to Italian dealers at the port of Civitavecchia.

Unsold cars at Avonmouth Docks near Bristol .

With many manufacturers on extended Christmas shutdown, the number of cars rolling off production lines in December fell 47.5% to just 53,823 .

Thousands of new cars are stored on the runway at the disused Upper Heyford airbase near Bicester, Oxfordshire, on December 18, 2008.

Sales of new cars in the UK have slumped to a 12-year-low and production of cars at Honda in Swindon has been halted for a unprecedented four-month period because of the collapse in global sales and represents the longest continuous halt in production at any UK car plant. The announcement comes on a day when the EU's Industry Commissioner Guenter Verheugen warned the outlook for the European car industry was 'brutal' and predicted not all European manufacturers would survive the crisis.

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