Gloomier warnings for the future
Friday, 11 July 2008
Fazle Rashid from New York
A drop in the oil price brought some relief for a battered and a badly bruised global economy but warnings for the future are becoming gloomier by the day. The US Federal policy planners, always reluctant to succumb to jitters in the market, conceded that turmoil plauging the economy, will spill deep into 2009.
The US entanglements in Iraq and Afghanistan and a recession in economy will leave little time to ponder for the next occupant of the White House. The bleak economic scenario was painted by no less a person than the US federal reserve chairman Ben Bernanke.
The Federal Reserve is contemplating several measures to reverse the downturn, one of which will be to extend lending at low interest rates to investment banks. Its Chairman urged the Congress to provide him with greater authority to monitor and supervise the financial market. Such request is not likely to be returned with barely anytime left for the current session. The US treasury secretary Henry Paulson joined the federal reserve chairman stating that the downturn in the economy will 'last longer than originally expected'.
The US government continues to act vigorously to resurrect a collapsing economy. The US Congress is putting last minute efforts to create a legislation on a $300 billion foreclosure-rescue plan that seeks to assist the troubled borrowers into getting more affordable loans. There were 1.5 million home-closures in 2007. The number is likely to jump to 2.5 million in 2008.
The Federal Reserve is breaking away from a long standing rule of providing assistance to only commercial banks by extending its loans to investment banks as well. The Fed, however, warned that financial markets would not become stable before sometime next year, economy would continue to suffer, consumer confidence will decline further, and the global economy will face sluggishness.
'The financial turmoil is on-going and our efforts today are concentrated on helping the financial system return to more normal functioning', the Fed chairman was quoted as saying. The number of corporate giants cutting jobs, shirking business and shoring their dwindling capital base is continuing. Steve and Barry, a reputed clothing outlet, is planning to seek protection under bankruptcy law.
It has even gone to Sears Holding Corporation for a possible take over. Steve and Barry has been fastest growing retailers in the US. The company is now operating on a razor thin margin which had an annual sales running into $1.1 billion.
In a sign that the global economy is catching up with Germany, one of country's largest exporters -- Siemens -- have announced it would cut 16,750 jobs across its far flung operations as it struggles to bolster profit in a weaking business climate, a report said. Siemens has office in Bangladesh. More than 800,000 jobs have been eliminated in the US in the past one year.
A drop in the oil price brought some relief for a battered and a badly bruised global economy but warnings for the future are becoming gloomier by the day. The US Federal policy planners, always reluctant to succumb to jitters in the market, conceded that turmoil plauging the economy, will spill deep into 2009.
The US entanglements in Iraq and Afghanistan and a recession in economy will leave little time to ponder for the next occupant of the White House. The bleak economic scenario was painted by no less a person than the US federal reserve chairman Ben Bernanke.
The Federal Reserve is contemplating several measures to reverse the downturn, one of which will be to extend lending at low interest rates to investment banks. Its Chairman urged the Congress to provide him with greater authority to monitor and supervise the financial market. Such request is not likely to be returned with barely anytime left for the current session. The US treasury secretary Henry Paulson joined the federal reserve chairman stating that the downturn in the economy will 'last longer than originally expected'.
The US government continues to act vigorously to resurrect a collapsing economy. The US Congress is putting last minute efforts to create a legislation on a $300 billion foreclosure-rescue plan that seeks to assist the troubled borrowers into getting more affordable loans. There were 1.5 million home-closures in 2007. The number is likely to jump to 2.5 million in 2008.
The Federal Reserve is breaking away from a long standing rule of providing assistance to only commercial banks by extending its loans to investment banks as well. The Fed, however, warned that financial markets would not become stable before sometime next year, economy would continue to suffer, consumer confidence will decline further, and the global economy will face sluggishness.
'The financial turmoil is on-going and our efforts today are concentrated on helping the financial system return to more normal functioning', the Fed chairman was quoted as saying. The number of corporate giants cutting jobs, shirking business and shoring their dwindling capital base is continuing. Steve and Barry, a reputed clothing outlet, is planning to seek protection under bankruptcy law.
It has even gone to Sears Holding Corporation for a possible take over. Steve and Barry has been fastest growing retailers in the US. The company is now operating on a razor thin margin which had an annual sales running into $1.1 billion.
In a sign that the global economy is catching up with Germany, one of country's largest exporters -- Siemens -- have announced it would cut 16,750 jobs across its far flung operations as it struggles to bolster profit in a weaking business climate, a report said. Siemens has office in Bangladesh. More than 800,000 jobs have been eliminated in the US in the past one year.