Protesters clashed with police in Paris at the headquarters of Total the French oil giant. These protests come after Total announced that the will be closing down their Northwest site.
Total said a worldwide decline in demand for petroleum products has lead them to this decision. There were around 300 demonstrators they smashed the windows at the offices. The police had to resort to tear gas to deal with the protesters. Total headquarters is located in the western suburb of La Defense. The CGT another key union, threatened “fire and blood” if management did not offer more.
When an individual cannot pay their debt; then they stand to lose their possessions. When a country cannot pay back their debt they are put in a similar situation.
According to Ken Rogoff, a former chief economist at the International Monetary Fund some countries will experience sovereign debt defaults.
A sovereign bond is a bond issued by a national government. These are then sold to create more money for an economy but they are redeemable so if an individual or company wants to cash in on the bond and the country cannot afford to pay it back then this is a sovereign debt default.
After a banking crisis we usually see a bunch of sovereign defaults, say in a few years. I predict we will again, stated Mr Rogoff. This is one of the greatest risks to a global economy. Greece and Portugal will “have a lot of troubles,” according to Rogoff.
Rogoff predicts that the richer countries will see slow growth but they will be more cautious with their spending and should be able to deal with the troubles ahead.
Blackberry and iPhone makers are going to be investigated by the International Trade commission (ITC) regarding the technology used in their phones. This was announced on Wednesday as Kodak have made a complaint that technology used in Blackberry and iPhone handsets may violate their digital patents.
This case has started because of a complaint from Kodak claiming that the technology used for previewing pictures infringes on Kodak’s patents. In December 2009, the ITC ruled that Samsung camera phones infringed on Kodaks patent.
Kodak has stated that it has made attempts to resolve this issue with both firms for years but has not come to any agreement with Apple and Research in Motion (RIM). Laura Quatela, Kodak’s chief intellectual property officer, told reporters last month. “In light of that, we are taking this action to ensure that we protect the interests of our shareholders and the existing licensees of our technology.”
This could help Kodak greatly if the ruling decides in favour of them and by the sounds of it Apple and RIM if they have been using this technology, then they definitely have infringed on Kodaks patent.
Two bankers from RBS have resigned after RBS have been forced to decrease the amount given in bonuses. Steve Ashley, head of RBS’s trading division and Chris Fleming, sales, quit the bank on Friday.
This is going to hit RBS hard as their trading business is one of their top earning businesses. Mr Kingman, the outgoing chief executive of UKFI, said “We cannot afford to be in a position where the banks lose so many people that we start to lose serious value.”
Although Gordon Brown stated that he will help the banks with ‘every last penny of taxpayer support .’ he also said. “I’m sure you share my anger with some of the banks, it is only fair that those who have contributed to the recession and have now benefited from taxpayers’ support give something to society in return.”
I believe a lot of the public are more inclined to the second statement. As the Times reported in December 2009 ‘MORE than 1,000 investment bankers have quit Royal Bank of Scotland to join rival firms for guaranteed cash bonuses and big salary increases, according to banking sources. ‘
This looks like a trend and as more top execs look for other opportunities and higher bonuses RBS is going to suffer. Also with more budget tightening on its way, which bank will be the next to see their top execs leave?
The governor of the Bank of England, Mervyn King, has predicted that inflation will rise above 3% in the next few weeks. Although this is a major worry he has also predicted that this will be short lived. This increase in inflation is due to higher VAT and the rises in petrol prices.
If his predictions are true and inflation does rise above 3% he will be expected to write a letter explaining this to the chancellor. “The UK economy has continued to bump along the bottom,” Mr King said.
He also stated that the UK will not see economic growth like they had before the economic crisis for “a considerable period”. Even with £200bn pumped into the economy by buying assets with newly created money the economy is still suffering. This raises questions on the effectiveness of quantitative easing (QE). Mr King has said that this QE has ‘helped economic recovery’ but how long will the UK have to wait to see the benefits of this?
D.Brown, chief European economist at Bear Stearns International said “The message the bank would like to get across to the market is that there is only room for moderate easing ahead, but the fundamentals say otherwise.”
This indicates that the UK has a bit more falling to do before the economy will rise again the question on most peoples minds is how far will the UK fall before it gets back up?
