The Morality of the Market

Since Fed chairman Ben Bernanke first suggested the possibility in late September, and confirmed it in October, markets and most economists have penciled in another round of quantitative easing (QE) as a solid bet.

With the long drum roll heightening expectations, the central bank’s policy-setting Federal Open Market Committee is expected to announce the second round of bond purchases, dubbed QE2, after a meeting Wednesday.

The country of more than 1.1 billion people already imports nearly 80 percent of its crude oil to fuel an economy that is expected to grow 8.5 percent this year and at least nine percent next year.

Demand for hydrocarbons — petroleum, coal, natural gas — “over the next 10 years will increase by over 40 percent,” Singh told an energy conference in New Delhi.

Gillard said she discussed the proposed 8.2 billion US dollar takeover of the Australian Stock Exchange (ASX) with Singapore Prime Minister Lee Hsien Loong during talks at the ASEAN summit in Hanoi.

She said both understood the community interest in the bid which needs approval from both Australia and Singapore and aims to create the world’s fifth biggest exchange with a market capitalisation of 12.3 billion US dollars.

More than 73 million people — a record for the extravaganza — visited displays by 189 countries during the half-year culture and technology showcase that brought snapshots of the world to ordinary Chinese.

“The success of the Expo has strengthened China’s confidence and resolve to pursue reform and opening up,” Wen told a forum at the Expo attended by Chinese and international officials on the final day.

The civil aviation sector in recent months has enjoyed a pronounced pick-up in both passenger and freight demand, with airlines welcoming the return of high-end travellers with deep pockets.

US carriers United, Continental, American Airlines and Delta Airlines earlier this month reported solid net earnings, followed this past week by upbeat announcements from airlines in Europe and Asia.

In the green mountains of Deir Mama in western Syria, near the imposing Masyaf citadel, Mohammed Saud and his family however still raise silk worms in the spring and still spin the loom in the autumn, determined to keep the ancient tradition alive.

“We are in this from A to Z. From raising the silkworm to making the shawl,” said Saud defiantly, even though he would make more money simply by selling his cocoons.

Haruhiko Kuroda told Asian leaders at a summit in the Vietnamese capital Hanoi that capital flows are one of two risks that regional economies face as they rebound from the global downturn that began in 2008.

His comments came shortly before the US Federal Reserve is expected to announce it will go into a second round of quantitative easing, injecting more money into the banking system to further stimulate the world’s biggest economy.

The national flag carrier will take delivery of the first aircraft in 2015, Vietnam Airlines president and chief executive Pham Ngoc Minh was quoted by Dow Jones Newswires as saying.

He said the airline was also in talks to buy a further eight of the aircraft and lease another three.

The agreement, reached late Friday after weeks of haggling and a break in the negotiations for a time, will see the PSD abstain in the first reading vote on the budget on November 3.

The government needs at least a PSD abstention as all other opposition parties have said they would vote against the budget, deemed vital to cut Portugal’s massive deficit and restore market confidence.

The investment will expand existing coal seam gas production in Queensland state and go towards the construction of a 540 kilometre (335-mile) underground pipeline linking gas fields to a pioneering new LNG plant.

BG Group, one of several companies seeking to convert Queensland’s rich coal seam gas deposits into LNG for export to meet surging Asian demand, made the final investment decision after receiving environmental approval on October 22.

Much of Zimbabwe’s food and consumer goods now come from neighbouring South Africa, where the rand in October touched a 33-month high against the US dollar, driving up prices in Zimbabwe.

“It’s difficult this side without the rands. We have been forced to cut down on some essentials such as flour. Last month we bought four packets of flour, but this month we bought three packets,” said Nyoni, a civil servant originally from Mberengwa, 430 kilometers (268 miles) south west of the capital said as he strolled a Harare shop with his wife.

The ECB is sure to maintain its main lending rate at a record low of 1.0 percent, analysts say, while focusing potentially tense talks on whether to continue unwinding its own unconventional measures.

A rift between ECB governors has opened over pursuing purchases of eurozone government debt, with German central bank chief Axel Weber saying he will stick to his guns even if it means passing on a chance to be the next ECB president.

“Unions demonstrated a lot of responsibility during the crisis,” putting wage demands aside in exchange for job security, said Gernot Nerb, a specialist at the Ifo economic institute.

With annual sector salary talks approaching, workers want to make sure their efforts now pay off.

“I put down my pad,” said Girsky, a banker brought in by the United Auto Workers union to report on GM’s finances. “I turned to my wife and said, ‘Remember this night. This is the night we figured out GM’s going out of business.'”

Two weeks later, the same realization was sinking in across America as the chief executives of GM, Ford and Chrysler — and the head of the UAW — flew to Washington to ask Congress for an unprecedented bailout. By November 2008, GM was on a path to become “Government Motors,” with the U.S. Treasury its majority shareholder.

The UK’s Sunday Times, citing sources close to the situation, reported that BHP plans to sweeten its offer for the world’s biggest fertilizer maker by 10 percent.

A person familiar with the situation, however, said BHP was focused on clearing regulatory hurdles, including winning approval from the Canadian government, before it does anything else.

The central bank was designed to be above political influence. But its policy decisions are not completely immune to the political environment.

A more conservative Congress would reduce the already slim chance that more fiscal support will come, putting the burden squarely on the Fed’s shoulders to shore up a limp economy.

After a two-month rally in the stock market, some investors are about to see if they get what they wished for: more Republicans in Congress and lots of cheap money.

The U.S. stock market has priced in the Republicans gaining ground in Tuesday’s midterm elections, an outcome widely seen as more business-friendly, as well as the Federal Reserve pumping billions into the economy through Treasury debt purchases. The Fed’s statement on Wednesday afternoon at the end of its two-day policy meeting is widely anticipated for details of the central bank’s economic stimulus plan.

The three plans, which were filed Friday with Delaware’s Bankruptcy Court, will compete for creditor support against the company’s proposed plan.

Like the company’s plan, the proposals allow for Tribune’s businesses, such as the Los Angeles Times and Chicago Tribune, to exit bankruptcy while creditors fight over how to apportion blame for its bankruptcy.

The move came a day after a government panel said Halliburton had used flawed material to cement the well.

Halliburton was hired by BP to seal the Gulf of Mexico well, which ruptured on April 20, killing 11 workers who were on the Transocean Ltd rig contracted to drill it. The disaster caused the worst offshore spill in U.S. history.

Gross domestic product expanded at a 2.0 percent annual rate as consumer spending rose at its fastest pace in four years, the Commerce Department said on Friday.

While consumer spending quickened and business investment continued to expand, much of the rise in demand was met by overseas production and domestic goods continued to pile up in warehouses, suggesting tepid growth in the fourth quarter.

But as they deliver preliminary assessments of the coming year, the picture they paint of the U.S. economy’s prospects provides scant comfort to the 14.8 million U.S. workers who are officially unemployed — and the millions more who are either underemployed or too discouraged to look for work.

That’s because the consensus in U.S. boardrooms — based on what executives have said this earnings season — is that the U.S. economy will continue to grow in 2011, but not fast enough to create a significant number of jobs.

Merck (MRK.N), like most big U.S. drugmakers in the third quarter, beat profit forecasts on Friday even though its sales fell short, as results were bolstered by cost cuts or other factors. And as with its rivals, investors seemed to pay greater heed to the sales disappointment.

“The third quarter featured slightly lighter revenues, better expenses and better tax rate,” said Credit-Suisse analyst Catherine Arnold of Merck’s results, describing them as a “low quality beat” because of the sales shortfall.

A growth rate of 5 percent or higher is needed to put a major dent in the nation’s 9.6 percent unemployment rate. Two reasons why that’s unlikely well into next year and maybe beyond:

• Construction – both residential and commercial – collapsed last year. And it isn’t expected to regain its strength for years. Typically after recessions end, construction booms and powers a new economic expansion.
• The recession that began in December 2007, after the housing bubble burst, became the Great Recession once the financial crisis erupted in September 2008. Economic recoveries that follow a financial crisis are typically long-lasting. Banks usually take years to resume lending normally.

“To really get ‘Morning in America’ and get people feeling like jobs are really coming back, I would want to see something close to 5 percent” annual economic growth, says economist Josh Bivens of the Economic Policy Institute, referring to the iconic 1984 Reagan re-election ad.

As the parliament prepares to hold what will be only its second session since the inconclusive election in March, lawmakers’ lavish salaries and privileges are deepening resentment among Iraqis struggling to make ends meet and frustrated with the political deadlock.

The Shiite religious leadership – always tuned into sentiment among the Iraqi religious majority – has warned politicians against living the high life while ordinary people lack basic services, such as electricity and water.

New York-area cable TV operator Cablevision Systems Corp. tested the limits of government intervention in October, calling early and often for the Federal Communications Commission to step in and force News Corp.’s Fox to keep providing its broadcast signal while it pressed for arbitration in a fee dispute.

Fox declined and the FCC did little more than suggest mediation if both parties were willing to participate. When the two sides couldn’t reach a deal, Fox blacked out its signals to 3 million Cablevision subscribers for 15 days, through two games of baseball’s World Series. On Saturday, Cablevision finally accepted terms it said were “unfair” for the sake of its customers.

It’s really pretty much up to President Barack Obama.

Despite the punishment his fellow Democrats are expected to take from voters, Obama has shown no sign of retreating from his insistence that families and small businesses with incomes above $250,000 return to higher, Bill Clinton-era tax levels starting Jan. 1.

Now Britain’s debt-shredding austerity measures will slash housing benefit payments used to subsidize rents for the low-paid, threatening to price tens of thousands of poor families out of their homes and force them toward the fringes of the country’s capital – an exodus that could permanently erode London’s famed ethnic, economic and cultural mix.

Outspoken London Mayor Boris Johnson likens the plan to “Kosovo-style social cleansing.” Some fear London will become more like Paris, where rich elites monopolize the city center and the poor stagnate in decaying housing projects ringing the capital.

The 84-year-old brand, moribund since General Motors decided to kill it last year as it collapsed into bankruptcy, had been in decline for years. It was undone by a combination of poor corporate strategy and changing driver tastes. On Oct. 31, GM’s agreements with Pontiac dealers expire.

Even before GM’s bankruptcy, Pontiac’s sales had fallen from their peak of nearly one million in 1968, when the brand’s speedier models were prized for their powerful engines and scowling grills.

More than 72 million visitors have been treated to a smorgasbord of cultures and technologies focused on the theme “Better City, Better Life” in the biggest, most expensive expo since such events began with the Great Exhibition of 1851 in London, which marked the coming of the Industrial Revolution.

The event showcased China’s rise as a modern industrial power, and drew accolades from U.N. Secretary-General Ban Ki-moon, who said it “offers hope for tackling global challenges.”

Generations of cattle owners who dipped their livestock in pesticides ended up killing not only the ticks that feast on them, but also the red-billed oxpeckers that eat the ticks. Now environmentalists want to cut out the pesticides, hand the job back to the birds, and in the process save them from extinction.

“We are repairing the damage done 100 years ago and (putting) nature the way it should be,” says Arnaud Le Roux, whose Endangered Wildlife Trust is overseeing Operation Oxpecker.

But at a cost, critics say – specifically, 44,000 jobs that might have been created, 22,000 cars left on the highway and an unrealized $30,000 bonus in real estate value for every New Jersey home located near a train stop.

“It really would have been a transformative project for land use in New Jersey,” said Peter Kasabach, executive director of New Jersey Future, a group that promotes sustainable growth. “It would have set the tone for the next 50 to 100 years.”

Shares of Halliburton gained 18 cents to close at $31.86 a share, a day after they plunged 8 percent when the oil services company acknowledged skipping a critical test of the cement.

Argus Research analyst Phil Weiss said investors may have seen the previous day’s plunge – and Friday’s lower opening – as an opportunity to buy the stock.

U.S. District Judge Carl Barbier said some of the components may be “deteriorating over time” and that tests should be done “as soon as reasonably practicable.”

The cement components had been subpoenaed by federal investigators looking into what caused the April 20 blowout of a BP well being drilled by the Deepwater Horizon rig. Halliburton was hired to seal the well with cement. The explosion aboard the Deepwater Horizon killed 11 workers and led to a spill of more than 170 million gallons of crude in the Gulf.