Twitter's Loss Widens. Will List Shares on the NYSE

  According to an article published on the Wall Street Journal:
Twitter Inc. revealed fresh financial details in a securities filing, including continued user growth but a wider loss in the third quarter, as costs continued to outpace revenue.

The San Francisco social network also Tuesday said it plans to list its shares on the NYSE a strong endorsement of the Big Board's effort to be a trading hub for technology companies.

The filing advances Twitter toward an initial public offering that could take place in November. The roadshow for the IPO could begin as soon as Oct. 25, according to people close to the discussions, although it isn't clear if it will.

For the third quarter, Twitter said its net loss widened to $64.6 million, from $21.6 million, in the same period a year earlier. The company booked big increases in expenses for research and development, and sales and marketing.

Quarterly revenue more than doubled, to $168.6 million, from $82.3 million a year ago. That was roughly the same growth rate as in the second quarter.

Helping to drive revenue was advertising on mobile devices, as users increasingly access Twitter on their smartphones. The company said more than 70% of advertising revenue came from mobile devices in the third quarter, compared with more than 65% in the second quarter.

To put Twitter's ad business in perspective: Users clicked on or retweeted 15 times as many ads in the third quarter as in the first quarter of 2012. Meanwhile, the average price of each ad is down over 75%

Japan Diet starts 53-day session aim to pass bills to supplement "Abenomics"

The Diet will convene a 53-day extraordinary session Tuesday with Prime Minister Shinzo Abe aiming to pass bills to supplement his "Abenomics" policies to fight chronic deflation.

The session, which comes after Abe's ruling coalition regained full parliamentary control in July's House of Councillors election, will revolve around debates on policies such as encouraging companies to boost investment and streamline industries to make them more globally competitive.

Abe will also push ahead with a bill to set up a ministerial council to help quickly respond to foreign and security issues, apparently considering the security environment in Northeast Asia, where North Korea's nuclear and ballistic missile ambitions and the assertive maritime policy of China remain of concern.

Source: NewsOnJapan

China, Vietnam target $100 billion trade for 2017

China and Vietnam will achieve bilateral annual trade volume of $100 billion by 2017, Premier Li Keqiang said during a luncheon with business leaders in Hanoi on Tuesday.

China has been Vietnam's largest trading partner for nine years.

Trade volume between the two countries exceeded $40 billion in the first eight months of this year, putting the annual target of $60 billion for 2015 within reach.

"China and Vietnam have the ability and wisdom to overcome difficulties in bilateral relations, deal with differences and expand common interests," Li said in his speech.

In a joint statement issued during his visit, the two countries reiterated a policy of good-neighborliness and comprehensive cooperation. They vowed to be good neighbors, friends, comrades and partners in developing relations.

"Three work teams will be set up to push forward maritime, onshore and financial cooperation between the two countries," Li said.

He also said that China would increase imports from Vietnam to cut the trade surplus.

Currency swap and yuan settlement deals are being discussed to facilitate trade.

Vietnamese Prime Minister Nguyen Tan Dung said his country welcomes Chinese enterprises investing in Vietnam.

China ranks 12th among the 100 countries and regions making direct investments in the country.

Li said Vietnam is one of the major overseas destinations for Chinese investors, and cooperation opportunities abound in infrastructure construction including road, railway, port and energy projects.

Wang Yuzhu, a researcher at the National Institute of International Strategy at the Chinese Academy of Social Sciences, said more efforts should be made to expand investment into each other's economies.

Song Yuhua, a professor at Zhejiang University's College of Economics, said Li's visit signals a new era for China and Vietnam to focus on trade partnership and economic cooperation, which has set a good example for other members of the Association of Southeast Asian Nations.

Many Chinese enterprises have already benefited from the countries' ever-closer economic links.

Li Shaoxing, chairman of Huaxia Machinery Plastics from Zhengzhou, Henan province, opened his first factory in Vietnam to produce plastic braided bags with an initial investment of $250,000 in 2003. The factory, located in Bac Giang province in the north of Vietnam, covers three hectares and has four production lines.

He said business has been good, with a 20 percent net profit margin each year, and he started to export his goods in 2008. He hopes more facilitating policies will be released to benefit Chinese enterprises in Vietnam.

Vietnam was the last stop of Premier Li's Southeast Asia tour after visiting Brunei and Thailand.

Source: Xinhua

London to develop further as yuan trading hub

China and the United Kingdom on Tuesday agreed to continue to build London into a major offshore market for yuan trading, underlining the strong financial ties between the two countries.

Both sides welcomed strong growth of London's RMB markets, making the capital city the most active RMB center in the world outside China, according to a joint statement after the fifth China-UK Economic and Financial Dialogue held in Beijing.

"China recognized London's major role in increasing the international use of the RMB, and both sides agreed to continued collaboration to support London's offshore market," the statement said.

To boost London's market status, China will give investors based in the city the right to buy 80 billion yuan worth of stocks, bonds and money market instruments issued by financial institutions in the Chinese mainland.

China allows foreign institutional buyers to trade yuan-denominated financial products through a regime called RQFII, or Renminbi Qualified Foreign Institutional Investor.

As a means to encourage foreign investors to hold the yuan, the RQFII now has a global quota of 350 billion yuan.

The extension of RQFII will deepen China's financial markets and strengthen RMB activity in the offshore market, the statement said.

"China agreed to further develop capital inflow and outflow channels for RMB, including for RMB trapped onshore, overseas direct investment and the development of Qualified Domestic Institutional Investor (QDII) quota to support liquidity in the offshore market," it said.

In addition, both sides agreed to support further RMB bond issuance in the UK by Chinese as well as international firms, and the development of London as an offshore RMB debt issuance center.

A number of cities are vying for China's permission to be allocated as a center for clearing yuan trading offshore, in expectation of providing lucrative financial services.

Source: Xinhua

Japan to build 14 gas and coal power plants with an investment estimate of US$7 billion

Japan plans to start up 14 new gas and coal-fired power plants by the end of 2014, allowing a switch away from pricey oil, as Tokyo struggles with a shutdown of nuclear reactors and energy imports drive a record trade deficit.

Regional power monopolies will construct 12 gas-fired units next year, while two new coal power plants will be completed by December 2013, according to a Reuters survey of utilities.

The new power plants will buy liquefied natural gas (LNG) and coal to scale back on the use of expensive crude and fuel oil plants. They will also give Japan a bigger buffer to prevent future power outages when generation plants go offline.

Expanding gas-fired generation is the only viable large-scale option in a nuclear-free Japan to power its industrial and commercial sector and keep electricity prices low enough for businesses to stay competitive globally.

Gas-fired units next year will add 5.2 gigawatts of capacity.The IEA estimates plants with such power output would cost about $4.5 billion.

The two coal-fired units due to start commercial operations in December will add 1.6 gigawatts online from the current 39 gigawatts. Building two plants that produce 1.6 gigawatts would cost about $2.4 billion, according to the IEA.

Source:Reuters

China prepares for smart city construction boom

Li Wei, who took a vacation to escape her big city life, did not expect her short stay in the small coastal city of Wanning on China's tropical island of Hainan Province, to be so "digital."

"Download a film within two minutes, scan two-dimensional codes with phones to learn about tropical plants, and make a body-building plan at the hotel's smart health room -- It totally threw me," Li said.

Wanning, which strives to boost its tourist industry by investing in making itself "smarter," is among 193 trial cities that have been approved by China's urban planning authorities to develop into "smart cities."

The smart city program, initiated last November, is part of the country's efforts to explore ways to foster a new type of urbanization.

Analysts believe that the program has presented a beautiful picture for both the country's future urban life and the potential of its economic growth.

First created by IBM, the "smart cities" concept promotes the use of new technologies such as the "Internet of Things," which allows users to control and manipulate objects through computers and cloud computing to boost information sharing and coordination within a city.

Such a concept is expected to generate changes in fields ranging from transportation to the financial sector. With the help of data analysis, big cities will be able to calculate traffic and make rational transportation routes to ease any gridlock.

In Beijing, a network based on the "Internet of Things" will be completed by 2015 to facilitate the operation of transportation, tele-medicine and a smart home. While Shanghai will focus on developing wireless broadband technology and boosting the application of intelligent technology.

"The construction of smart cities will facilitate the transformation of China's urban industries, innovate social management, improve the ecological environment and promote the public services system," said Guo Liqiao, deputy director of the department of science and technology at the Ministry of Housing and Urban-Rural Development (MHURD).

According to Guo, aside from the current 193 trial cities, many other places have submitted applications for the smart city program, indicating that more local governments have realized that the old path of urbanization can not support sustainable development of the local economy.

More than 80 of the trial cities have signed smart city design plans with the MHURD, which describe the tasks of local authorities regarding the building of smart cities over the next three to five years. The signing signals the start of actual construction.

A report conducted by McKinsey Global Institute showed that China's urban population will grow from 63 million in 2010 to reach 990 million in 2030, and cities with a population exceeding 1 million are likely to increase from 153 to 226 in the period.

"The transfer of such a huge urban population means that many small towns and villages will become cities, which requires local governments to increase efforts in boosting city construction," said Wang Yukai, a professor at the Chinese Academy of Governance.

Official data showed that a few financial institutes, including China Development Bank, the country's policy bank, have promised to loan no less than 440 billion yuan (72 billion U.S.dollars) to fund the construction of smart cities since the launch of the program.

The program came as China's growth got stuck in a protracted slowdown. Growth in the world's second largest economy declined to 7.7 percent in the first quarter and 7.5 percent in the second quarter.

"The investment in the sector will be huge," Wang said. He said that many industries, especially smart technology and digital companies, will benefit from the program, but it is still early to estimate the overall market size as the smart city concept is quite new.

Although the market generally viewed the program as a boost to the economy, many worried that the rush may lead to blind construction.

Wang suggested that the government should make an overall plan and gradually establish standards for smart city construction.

Source: Xinhua

US warned of credit downgrade as Republicans inch closer to the brink

A leading ratings agency put the the US on notice of a downgrade on Tuesday amid political turmoil in Washington over how to resolve the budget crisis less than a day before the country's borrowing requirement expires.

Fitch warned that the political battle "risks undermining confidence in the role of the US dollar as the pre-eminent global reserve currency, by casting doubt over the full faith and credit of the US.

But senior Republicans in the House of Representatives inched further to the brink on Tuesday night when they abandoned a planned vote, which would have extended the debt ceiling and reopened the federal government, when it became clear the they could not muster enough votes.

A day that ended in turmoil began with recriminations when the House initially rejected a fragile bipartisan deal that emerged from the Senate on Monday night. 

The House speaker, John Boehner, then floated an alternative compromise that would have, in addition, delayed a new tax on medical devices designed to help pay for the Affordable Care Act and deprive lawmakers of any personal health insurance subsidies. That succeeded only in inflaming conservatives in his own party, who regarded the House and Senate compromises as surrender.

Source: theguardian

Japan's SoftBank says in talks to buy Brightstar stake

SoftBank Corp is in talks to buy a stake in U.S. wireless device distributor Brightstar Corp that media reported could be worth more than $1 billion and boost its bargaining power with hardware suppliers.

The company's billionaire founder Masayoshi Son has said that one of the key benefits of an earlier purchase of U.S. mobile carrier Sprint Corp would be to bolster the group's position with handset makers, an industry dominated globally by Samsung Electronics Co Ltd and Apple Inc.

A report by the Nikkei business daily said the Japanese tech and telecoms group was in the final stages of talks to buy an up to 70 percent stake in Brightstar in a deal worth more than 100 billion yen ($1 billion).
Source: Reuters

SoftBank buys $1.5 billion for 51% stake in Finnish mobile games maker Supercell

 Japanese tech and telecoms group SoftBank Corp is paying 150 billion yen ($1.53 billion) for a 51 percent stake in Finnish mobile game maker Supercell, valuing the small maker of hit games "Clash of Clans" and "Hay Day" at $3 billion.

Softbank's bid to claim a leading role in the fast-growing mobile games market makes 3-year-old Supercell, with about 100 employees and just two free-to-play games, more valuable than Zynga Inc, the $2.8 billion company behind former hits such as "FarmVille."

Twenty percent of Softbank's investment will come from its mobile games maker subsidiary, GungHo Online Entertainment Inc, which has a market capitalization of about $8.3 billion.

Softbank's offer values Supercell, with daily revenue of about $2.4 million mainly through the sale of in-game, virtual items, at about 3.5 times projected annual sales. That is cheaper than several major recent deals such as Electronic Arts' acquisition of PopCap in 2011, which went through at about 10 to 11 times sales the year before.

Market researcher Newzoo estimates global game revenues across all platforms will reach $86.1 billion by 2016 as the number of gamers reaches 1.55 billion. It expects the fastest growth to come from mobile gaming, which will make up almost 30 percent of the total, up from about 17 percent this year.

The deal shows SoftBank Chief Executive Masayoshi Son's appetite for foreign M&A has not dimmed since his $21.6 billion acquisition of U.S. mobile carrier Sprint Corp this year.

Source: Reuters

China, Russia to expand energy cooperation

China and Russia on Tuesday pledged to expand energy cooperation in projects of oil and gas supply, nuclear energy and renewable energy.

Chinese Vice Premier Zhang Gaoli and Russian Deputy Prime Minister Arkady Dvorkovich co-chaired the tenth meeting of China-Russia energy cooperation committee in Beijing, which agreed to advance cooperation in a number of energy sectors.

Noting that energy cooperation is a key area of China-Russia cooperation, Zhang said he hoped to advance discussion on existing projects and find new sectors for cooperation through the committee's effort.

"China is willing to expand all-around energy cooperation with Russia. We hope the two sides can work together to ensure the increase of Russian oil supplies to China, expand cooperation in upstream oil projects and set a refinery joint venture in Tianjin as a pilot project," Zhang said.

He said China also hopes to work with Russia on natural gas and nuclear energy projects, increase coal and electricity import from Russia, and expand cooperation in fields of renewable energy and energy efficiency.

"The Chinese leadership attaches great importance to developing the comprehensive relations of strategic cooperation and partnership with Russia," Zhang said, adding that energy cooperation is an important component of their partnership.

The China-Russia cooperation is highly complementary in terms of resource, market and technology, which means huge potential, Zhang said.

Dvorkovich said Russia is ready to work with China to take advantage of each other's competitiveness and achieve new cooperation in energy sectors.

Source: Xinhua

US: No Progress in Negotiations of Both chambers

Negotiations in Congress to end the fiscal impasse sputtered on Tuesday, leaving both chambers grasping for a way to reopen the government and raise the country's borrowing authority with a Thursday deadline drawing near.

The Senate halted discussions on its own plan, as it waited for the fractious Republican-controlled House of Representatives to come up with an alternative proposal ahead of the October 17 deadline, when the U.S. Treasury says the government will reach its borrowing limit.

Senate leaders had been close to a deal that would reopen the government and raise the debt limit until early 2014, while the initial alternative plan proposed by House Republican leaders failed to gain enough support in a closed-door meeting for the House to proceed.

"There are a lot of opinions about what direction to go. There have been no decisions about exactly what we will do," House Speaker John Boehner told reporters after the meeting.

"We're going to continue to work with our members on both sides of the aisle to try to make sure that there is no issue of default, and to get our government reopened," he said.

The disarray among House Republicans raised questions about what the House will be able to pass. Conservative House members, driven by support from Tea Party small-government activists, have demanded changes to Obama's signature healthcare law as part of any budget deal.

Philippines Takes China's Sea Claims to Court

  According to an article published in the Wall Street Journal the Philippines  Challenge Beijing's Sea Claims and has launched this year at the United Nations an arbitration of the disputed sea claims.

 "The Philippines brought the case in January under the 1982 United Nations Convention on the Law of the Sea, which governs the world's oceans. China is a signatory. The heart of the case is that the line has no basis under the U.N. convention, which states that coastal states are entitled to a territorial sea extending 12 nautical miles as well as a 200-mile economic exclusion zone in which they have rights to fish and extract undersea resources".

"Mr. Reichler is the lead lawyer representing Manila in its legal challenge against China's claim to almost all of the South China Sea, signified by the "nine-dash line"-a U-shaped protrusion on Chinese maps that brushes the coastlines of smaller states, including the Philippines, Brunei, Malaysia and Vietnam".

"The Philippines brought the case in January under the 1982 United Nations Convention on the Law of the Sea, which governs the world's oceans. China is a signatory. The heart of the case is that the line has no basis under the U.N. convention, which states that coastal states are entitled to a territorial sea extending 12 nautical miles as well as a 200-mile economic exclusion zone in which they have rights to fish and extract undersea resources".

"Of course we're aware of the enormity of taking on a country like China. We'd be foolish not to" be aware, says Mr. Reichler, a litigator with the U.S. law firm Foley Hoag".

"The Arbitral Tribunal has appointed a five-person panel of judges and issued a timetable for handling the case, including a deadline for the Philippines to submit its evidence by March 30 next year.

It's the first time that Beijing has been taken to a U.N. tribunal and China is furious. Most recently, it showed its displeasure by making clear that Philippine President Benigno Aquino would'nt be welcomed at a Trade Event in southern China in August.

China insists that territorial disputes over islands in the South China Sea should be settled through bilateral negotiation under its frequently stated principle of "shelving disputes and going in for joint development".

Beijing's refusal to participate hasn't stopped the case going ahead. It could even speed its resolution: Mr. Reichler says that if China doesn't take part, the case could wrap up by the end of 2014. Such cases can otherwise drag on for up to five years.

To some skeptics, Manila's challenge is quixotic. Even if the tribunal decides it has jurisdiction over the case, and then finds in Manila's favor, Beijing could simply ignore the verdict.

Yet there are more than legal considerations at stake. The case is also significant for what it will signify about the way that China views the world".

WSJ Real-Time Economic Data Could Be a Game Changer

   According to an article published in the Wall Street Journal:

''The world of economic data may be headed for a substantial revision.

Private companies are deploying new technology to overhaul a half-century-old approach to tracking changes in the global economy, promising constantly- updated gauges to guide major corporations, hedge funds and governments.

The latest entrant, Premise Data Corp., is the first to create real-time inflation data using hundreds of people snapping photos of store shelves and produce carts around the world daily to track price changes.

The startup, backed by investors Google Ventures, Andreessen Horowitz and Harrison Metal, will be unveiled Tuesday after quietly building itself for nearly two years.

Premise has deployed 700 smartphone-equipped workers across 25 cities to capture images of products as their prices change daily. Software automatically tags the location of the products down to the individual store and analyzes the images—items such as meat and produce—to gauge quality differences. A user viewing the information can zoom in on images of the products at each retail location, making it a store-shelf version of Google Street View.

Premise's computers also scroll through websites to automatically grab prices from Internet stores, a process that still provides about 80% of the data the firm uses to create real-time inflation gauges.

Technological innovations such as efficient supply networks and just-in-time delivery "have completely altered human economic activity," said David Soloff, founder and chief executive of Premise. "Yet the indicators people are looking to are caught in a different era."

Mr. Soloff credits PriceStats for its original breakthroughs in the field. He said Premise's goal is to provide even deeper information—down to the product level rather than just categories of products—and provide the technology platform for a wide range of other economic indicators beyond inflation.

Reports on inflation, employment and consumer spending—generally based on monthly snapshots are released with a lag of weeks or months, and they can be revised months later. The shortcomings create problems for investors and policy makers, who have to act in real time even if the economy is changing faster than existing methods can measure.

Still, building accurate and reliable indicators will face numerous pitfalls. Economists have struggled for decades with sampling errors in traditional economic reports. A crowd-sourced approach, using people with limited training, could take years of work to filter out noise in the system. Premise's own price-collectors are part-timers working a few hours a day, earning 10 cents to 30 cents per image captured.

Outsiders have questioned Argentina's inflation data for years. That inspired Alberto Cavallo, an economist at the Massachusetts Institute of Technology, to create his own measures starting in 2007.

The effort eventually became the academic initiative called the Billion Prices Project, collecting data from online retailers around the world to create daily inflation measures. In 2010 it led to PriceStats, which distributes inflation gauges through the financial-services firm State Street Corp. to about 7,500 clients.

In a demonstration, Mr. Soloff clicked through the Premise website to show store shelves in China and produce carts in India. His data showed when onion prices started surging in India last summer weeks before the press caught on to the public uproar. That kind of data could be useful to a hedge fund trading currencies before official inflation measures are released.

Hal Varian, Google Inc.'s chief economist and a Premise adviser, said the data could give government officials insight into developments that can stir up their populations. Prices for popular food items—bread in the Middle East, corn in Mexico or pork in China—could be tracked well ahead of popular unrest".

"All these things are sensitive from a political point of view," Mr. Varian said. "Having up-to-date information is quite valuable."

Google lancia gli Youtube Music Awards

MTV? Acqua passata: ora anche YouTube lancia i suoi Music Awards. La prima edizione è prevista per il 3 novembre, si svolgerà al Pier 36 di New York e sul palco ci saranno artisti internazionali del calibro di Lady Gaga, Eminem e gli Arcade Fire. Un ottimo biglietto da visita per l’evento, che si propone di diventare un punto di riferimento per il panorama musicale mondiale (battendo sul loro stesso terreno altri spettacoli dello stesso tipo, primo fra tutti il celebre MTV VMAs). E, anche, di far scoprire talenti nati e cresciuti sul Web: oltre alle star dell’industria discografica mondiale, all’evento si esibiranno anche musicisti che hanno fatto il boom di click sulla piattaforma. Come Lindsey Stirling (violinista che conta 3,2 milioni di utenti che la seguono e il gruppo sperimentale CDZA(che, invece, ne ha totalizzati 215mila). 
La prima grande novità riguarda la scelta dei finalisti. La selezione delle nomination, che saranno annunciate il 17 ottobre, si baserà infatti sui video più cliccati e condivisi nel corso dell’anno dagli utenti di YouTube (che hanno ormai raggiunto e superato la quota di un miliardo di utenti mensili). I vincitori verranno poi scelti in base al voto degli internauti e alle condivisioni sui social network: le premiazioni si terranno il 3 novembre a New York e lo spettacolo sarà trasmesso in streaming sulla piattaforma.

Corriere della Sera

A new challenge to books? Stories that follow you into the real world

''It is part book, part film, part game – and a world away from the six novels in contention for tonight's Man Booker prize. But Julian McCrea, developer of the immersive iPad thriller The Craftsman, launched this week, is convinced his mashup of literary gothic and cinematic chiller is the future of fiction.
With sales of paper books declining, McCrea believes the app represents a new kind of digital storytelling that could open up an Alice in Wonderland rabbit hole of possibilities.

"No two people will get the same experience," says McCrea, who gave up his job on Dr Who – launching the programme's global Facebook page – three years ago to start Portal Entertainment.

The project has echoes of the "choose your own adventure" paperbacks of the 1980s and 90s, which allowed pre-teen readers to plot their own way through treasure islands and spooky forests. But the creators of the new app wanted to take the idea further.

"You", as a fully paid-up character in the drama, can sign online petitions on fictitious websites and receive cryptic messages on your mobile phone from other characters, while the events you attend in the story pop up in your real-life calendar, as the app's creators attempt to "bleed" the story into your everyday life.

With the story unfolding in short episodes over five days, McCrea hopes to capture an audience of thirtysomething dads used to whipping out their phone to play Angry Birds when they have a spare five minutes. But also in his sights is the £87m British market for thrillers and crime novels''.

Source: theguardian

Teenage students and Chinese law work-placements

You'll hear a lot of pieties about China this week. As George Osborne and Boris Johnson schlep from Shanghai to Shenzhen, they'll give the usual sales spiel about trade and investment and the global race. What they won't talk much about is Zhang Lintong. Yet the 16-year-old's story tells you more about the human collateral in the relationship between China and the west than any number of ministerial platitudes.

In June 2011, Zhang and his teenage classmates were taken out of their family homes and dispatched to a factory making electronic gadgets. The pupils were away for a six-month internship at a giant Foxconn plant in the southern city of Shenzhen, a 20-hour train ride from their home in central China. He had no say in the matter, he told researchers. "Unless we could present a medical report certified by the city hospital that we were very ill, we had to go immediately."

As a first-year student at a secondary vocational school, it was illegal for Zhang (not his real name) to be sent on any kind of internship. And under Chinese law work-placements have to be directly related to a pupil's studies. Zhang was an arts major and a fan of the work of Russian realist painters. He was to spend half a year turning out iPhones and other consumer electronics.

(After the Great Recession 2008-9) Five Years in Limbo. Joseph Stiglitz

"Five years later, while some are congratulating themselves on avoiding another depression, no one in Europe or the United States can claim that prosperity has returned. The European Union is just emerging from a double-dip (and in some countries a triple-dip) recession, and some member states are in depression. In many EU countries, GDP remains lower, or insignificantly above, pre-recession levels. Almost 27 million Europeans are unemployed"
"Similarly, 22 million Americans who would like a full-time job cannot find one. Labor-force participation in the US has fallen to levels not seen since women began entering the labor market in large numbers. Most Americans’ income and wealth are below their levels long before the crisis". 
''Yes, we have done some things to improve financial markets. There have been some increases in capital requirements – but far short of what is needed. Some of the risky derivatives – the financial weapons of mass destruction – have been put on exchanges, increasing their transparency and reducing systemic risk; but large volumes continue to be traded in murky over-the-counter markets, which means that we have little knowledge about some of our largest financial institutions’ risk exposure''.

''Other problems have gone unaddressed – and some have worsened. America’s mortgage market remains on life-support: the government now underwrites more than 90% of all mortgages, and President Barack Obama’s administration has not even proposed a new system that would ensure responsible lending at competitive terms. The financial system has become even more concentrated, exacerbating the problem of banks that are not only too big, too interconnected, and too correlated to fail, but that are also too big to manage and be held accountable. Despite scandal after scandal, from money laundering and market manipulation to racial discrimination in lending and illegal foreclosures, no senior official has been held accountable; when financial penalties have been imposed, they have been far smaller than they should be, lest systemically important institutions be jeopardized''.

''The credit ratings agencies have been held accountable in two private suits. But here, too, what they have paid is but a fraction of the losses that their actions caused. More important, the underlying problem – a perverse incentive system whereby they are paid by the firms that they rate  has yet to change''.

''Bankers boast of having paid back in full the government bailout funds that they received when the crisis erupted. But they never seem to mention that anyone who got huge government loans with near-zero interest rates could have made billions simply by lending that money back to the government. Nor do they mention the costs imposed on the rest of the economy – a cumulative output loss in Europe and the US that is well in excess of $5 trillion.
Meanwhile, those who argued that monetary policy would not suffice turned out to have been right. Yes, we were all Keynesians – but all too briefly. Fiscal stimulus was replaced by austerity, with predictable – and predicted – adverse effects on economic performance''.

''Some in Europe are pleased that the economy may have bottomed out. With a return to output growth, the recession defined as two consecutive quarters of economic contraction, is officially over. But, in any meaningful sense, an economy in which most people’s incomes are below their pre-2008 levels is still in recession. And an economy in which 25% of workers (and 50% of young people) are unemployed – as is the case in Greece and Spain – is still in depression. Austerity has failed, and there is no prospect of a return to full employment any time soon (not surprisingly, prospects for America, with its milder version of austerity, are better)"

Quotes of Article of Joseph Stiglitz Five Years in Limbo
               Project Syndicate

Five reasons Burberry's CEO is perfect for Apple

   Angela  Ahrendts is considered a pioneer in bringing upmarket fashion online, and in recent years Burberry has been as comfortable talking about smartphones as skirt lengths. Its latest annual report, which shows revenues have grown from £740m when Ahrendts joined, in January 2006, to almost £2bn today, forecasts the "dissolution of boundaries separating physical and digital channels".

Burberry says that while the global recession has meant soft footfall instore, online has helped pick up the slack. Burberry uses social media extensively, building excitement around its collections by photographing clothes before they leave the studio and backstage before they appear on the catwalk. Ahrendts has already worked closely with Apple. Burberry helped launch the iPhone 5S by using dozens of them to live stream its London catwalk show.

Burberry.com delivers in more than 100 countries and the website has been translated into eight languages, including Korean and Spanish.

At Burberry, her vision was to "serve completely any consumer on any platform in any geography". It is an ambition she may well bring to Apple.

Source: theguardian

Alitalia: Zanonato, infondate accuse British Airways su aiuti di Stato

"Non mi pare siano fondate le critiche e le accuse" di British Airways sulla presenza di aiuti di Stato nell'operazione Alitalia. Cosi' il ministro dello Sviluppo economico, Flavio Zanonato, interpellato al Quirinale a margine della cerimonia di consegna delle onorificenze ai Cavalieri del Lavoro. "L'operazione che e' stata fatta - ha spiegato Zanonato - e' puramente industriale: non e' un aiuto. Aiuto significa che si mettono dei soldi per ridurre, ad esempio, un gap nel campo dei costi e che portano alla fine a ridurre il rischio degli imprenditori. Qui e' invece un 'operazione puramente industriale", ha ribadito. Inoltre, in merito alle voci circolate a proposito di un rifiuto che ci sarebbe stato da parte dell'amministratore delegato di Fs, Mauro Moretti, di intervenire a sostegno della compagnia aerea, il ministro ha definito questo presunto retroscena "assolutamente falso: Moretti - ha precisato Zanonato - ha lavorato per trovare una soluzione. 

Corriere della Sera

Neil Gaiman*: Why our future depends on libraries, reading and daydreaming. British writer

Fiction has two uses. Firstly, it's a gateway drug to reading. The drive to know what happens next, to want to turn the page, the need to keep going, even if it's hard, because someone's in trouble and you have to know how it's all going to end … that's a very real drive. And it forces you to learn new words, to think new thoughts, to keep going. To discover that reading per se is pleasurable. Once you learn that, you're on the road to reading everything. And reading is key. There were noises made briefly, a few years ago, about the idea that we were living in a post-literate world, in which the ability to make sense out of written words was somehow redundant, but those days are gone: words are more important than they ever were: we navigate the world with words, and as the world slips onto the web, we need to follow, to communicate and to comprehend what we are reading. People who cannot understand each other cannot exchange ideas, cannot communicate, and translation programs only go so far.

I was in China in 2007, at the first party-approved science fiction and fantasy convention in Chinese history. And at one point I took a top official aside and asked him Why? Science Fiction had been disapproved of for a long time. What had changed?

It's simple, he told me. The Chinese were brilliant at making things if other people brought them the plans. But they did not innovate and they did not invent. They did not imagine. So they sent a delegation to the US, to Apple, to Microsoft, to Google, and they asked the people there who were inventing the future about themselves. And they found that all of them had read science fiction when they were boys or girls.

Fiction can show you a different world. It can take you somewhere you've never been. Once you've visited other worlds, like those who ate fairy fruit, you can never be entirely content with the world that you grew up in. Discontent is a good thing: discontented people can modify and improve their worlds, leave them better, leave them different.

Source: theguardian

Blackrock, torneremo a investire su Italia se spread si allarga

Blackrock sul mercato obbligazionario e' "neutrale su Italia e Spagna", mentre preferisce Irlanda, Portogallo e Slovenia e complessivamente e' "positivo sulla periferia dell'Eurozona". Cosi' ha spiegato, nel corso di una conferenza stampa a Milano, Andrea Vigano', country head Blackrock Italia. "La visione di fondo di Blackrock sull' Italia e' sempre stata molto positiva, ora e' meno attraente visto il restringimento dello spread, anche se la visione di fondo resta comunque positiva. Le valutazione sono piu' o meno corrette. Se lo spread si allarghera' torneremo a investire", ha precisato Vigano' spiegando che l'Italia e' un "paese patrimonialmente piu' solido" a livello complessivo di debito, risparmio famiglie, banche. "Il problema e' la velocita' di crescita molto bassa, che richiede ulteriori riforme per essere accelerata". 

Corriere della Sera

EU Set to Approve Euro-Zone Banking Supervisor

  According to an article published today in the Wall Street Journal:
''European Union finance ministers are expected to give their final approval for a new banking supervisor for the euro zone Tuesday, three European officials said Monday, allowing the European Central Bank to formally start preparations for its new role as the currency union's chief banking policeman.
The U.K. last week held up the final sign-off on legislation transferring the power to supervise banks in the euro zone to the ECB—further delaying one of the central elements of the bloc's response to the financial crisis. British officials said they were worried that handing euro-zone banking supervision to the ECB would allow the 17 euro-zone countries to dominate decision making in the European Banking Authority, the supervisor for all 28 EU countries.

The legislation already stipulated that all decisions in the EBA would have to be made by a so-called "double majority"—a majority of both euro and non-euro countries—until the number of EU countries outside the currency bloc has fallen to four.

But the U.K. feared that future banking legislation could nevertheless lead to an earlier change in the EBA voting rules.

To counter those concerns, EU finance ministers at their meeting in Luxembourg Tuesday will approve a declaration that reaffirms their previous commitment to leave EBA voting rules untouched, said the three officials. The decision to add the declaration was taken by all EU ambassadors, including the U.K. representative, in Brussels Monday morning''.

India's Central Banker Lobbies Fed

''India's new central bank governor, Raghuram Rajan, is waging a vigorous two-front war.

At home, Mr. Rajan is trying to repair the damage inflicted on his country's decelerating economy after investors this summer retreated from emerging markets in anticipation of an end to easy-money policies in the U.S.

Abroad, he is campaigning to persuade the U.S. Federal Reserve and other central banks that they need to pay more attention to the consequences of their actions for the developing world and do more to mitigate the fallout.

This past week, he brought his fight here to Washington, where the International Monetary Fund was holding its annual meeting.

 "If you want stronger global demand, you really need to think about international arrangements to deal with these issues," Mr. Rajan said in an interview on the sidelines of the meetings. He urged a process by which the central banks of advanced nations give greater weight to the global spillover effects of their policies.

In May, mere mention by the Fed of an eventual shift sparked a global emerging-market selloff. In the three months that followed, India's currency lost nearly a quarter of its value. Stocks dived.

Countries from Indonesia to South Africa, Brazil and Turkey also got slammed, as investors, betting that returns in the U.S. would rise, pulled their money out.

Mr Rajan an MIT Economist,was Chief economist at the IMF,and taught at the University of Chicago.

And he has been right before about the unintended consequences of Fed policy.

Famously, in 2005 he warned a roomful of Fed officials in Jackson Hole, Wyo., that the world risked a dangerous financial bubble.

In January, Mr. Rajan, at the time an adviser to India's finance minister, warned his counterparts at a meeting in New Delhi of officials from the Group of 20 industrial and developing nations that they should wake up to the dangers posed to emerging markets by an end to easy-money policies in the U.S.''

Japan Seeks to Export More High-End Food

  According to a report from the Wall Street Journal:
"Just as France exports fine wine, backers of Mr. Abe's plan hope Japan will become world famous for its painstakingly cultivated fruit, rice, beef and sake.
For decades Japan's agriculture sector has been protected by high tariffs.Figures from the Organization for Economic Cooperation and Development show that Japanese farmers now rely on government support for 56% of their total receipts, compared with just 7% in the U.S. and 19% in the European Union.
Mr. Abe now appears willing to overturn the long-cozy relationship between farmers and politicians. As part of his economic program, he is looking to slash import tariffs as part of his commitment to a U.S.-led trade pact for Asia known as the Trans-Pacific Partnership. That could provide a big boost for Japan's big industrial exporters. But the partnership could also provide opportunities for food importers, attracted by Japanese retail prices that are more than double the global average for potatoes and three times higher for apples.
To compensate for the domestic industry's potential loss of market share, Mr. Abe wants Japanese farmers to look abroad. He is aiming to have agriculture exports, which currently account for just 16% of total output, double by 2020. While some items like high-quality beef and rice have found buyers in overseas markets, overall farm-product exports have been flat since 2006, and amount to just one-eighth of those of Italy, a major global exporter of high-end food products.

In addition, the government places a high importance on improving exports because the domestic market is shrinking. Japan's population is expected to fall by more than 20% to less than 100 million people by 2050, according to official estimates.

The export drive, which was previously restricted to a small band of farmers willing to forego domestic subsidies so they could compete abroad, is now gathering traction with some of Japan's biggest financial houses and global trading firms".

TD Bank mulls nearly $13B bid for RBS U.S. arm: Report

Toronto-Dominion Bank is considering a $12.8 billion US bid for Royal Bank of Scotland's American retail banking business Citizens, The Sunday Times reported without citing sources.

The newspaper said the Canadian bank has long coveted Citizens and has become more interested since the summer.

TD Bank and RBS both declined to comment on the report.

RBS, 82 percent owned by British taxpayers, said in February that it would sell 20-25 percent of Citizens in the next two years through an initial public offerring in New York.

It is under pressure from lawmakers to focus on lending to British households and businesses, and from Britain's financial regulator to bolster its capital position.

Analysts have said that a full sale of the U.S. business could raise as much as 8 billion pounds.

Toronto-Dominion is one of a number of parties to have been linked with a takeover of the business, but Chief Executive Ed Clark dismissed the idea in February, saying that a deal would not meet his bank's stated criteria for acquisitions.

Source: REUTERS

Empire State Mfg Survey 1.52

The government shutdown may be slowing, but not yet reversing, growth in the New York manufacturing region. The Empire State index is holding over zero, at 1.52 to indicate a slight rate of growth in composite activity, down from September's 6.29.

But growth in the report's leading indicator -- new orders -- is accelerating slightly, from 2.35 and 0.27 in the prior two months to 7.75 which is the best reading since March.

Other details include a second solid month for shipments and very strong readings for 6-month expectations. Negatives include slowing in jobs growth and continued contraction in backlog orders. Price data show steady upward pressure for raw materials but very little pressure for finished goods.

The economic calendar is getting thinner day by day, putting regional surveys from the Federal Reserve suddenly in the spotlight. Today's report points to resilience and no significant shock effect, at least initially, from the government shutdown. The Philly Fed report, the most closely watched of all regional manufacturing surveys and which surged in September, will be posted on Thursday.

Source: The Wall Street Journal