Gloomy US market casts shadows abroad
Sunday, 30 November 2008
Fazle Rashid from New York
THE General Motors (GM), one of the three giant US automakers -- all three of them in knee-deep trouble due to shorn of capital -- is set to sell its assets in Europe to shore up its dwindling capital base. All three carmakers vainly sought financial aids from the government.
The GM intends to raise $257 million by selling its properties in Europe. Running critically short of cash, GM is making a global push to add upto $4.0 billion to its almost empty coffer. The company is in such a distress that it is even contemplating selling its Detroit skyscapper complex that serves as its head office, all these were revealed by a reputed newspaper last Friday. The price of the commercial properties have dropped about a quarter this year.
Analysts predict that given the current gloomy market, the automaker would find it difficult to meet its target. They went on to add that even $4.0 billion the automaker is trying to raise through sale of its properties would not be enough. The company has burned $6.9 billion in the third quarter.
Meanwhile, Finance Minister of France Christine Lagarde has disclosed that government plans to underwrite $6.0 billion of credit insurance for risky companies to try to prevent a collapse of confidence in lending between businesses.
The Panasonic, the Japanese electronic coglomerate announced that its operating profit will come down by 40 per cent. This will reawaken fear that its rivals Sony and Toshiba are also facing trouble. Sony had earlier announced a 57 per cent drop in its operating profits. The maxim honesty is the best policy is being reversed. A British Airways executive facing the threats of gaol, because of fixing fuel price, has been promoted to the company's board.
Former UBS executives have paid back or forfeited bonuses amounting to $58 million as banks across the globe are under mounting pressure to limit executive compensation after being bailed out by tax payers money.
Bank executives in Goldman Sachs, Deutsche Bank and Barclays have all agreed not to take bonus. The Wall Street firms are pledge-bound not to pay their executives any bonus out of the fund received from the government.
In America, shopping season got underway from Friday as nation's retailers went into a price-cutting frenzy.
Such famed retail outlets like Macy's and Gay and Lord are offering rebates upto 50 per cent. A set of diamond earrings priced at $700 is now being offered at $249. Saks at the 5th Avenue in New York is the most expensive retail outlet in the world. A mark Jacob bag originally priced at $995 is now being sold $248.
A Ted Baker suit at Lord and Taylor priced at $895 is now available at $399. For weeks they ( retailers )have been trying to undo one another to capture the attention of the consumers who have become dumb to the wooing, the New York Times reported last Friday. Like in Eid in Bangladesh the retailers here in America make about 40 percent of the annual earnings during this festive season. Retailers are hoping against hope to make some money.
Amidst this gloomy economic scenario, the rush for booking rooms in hotels and apartments in Washington for the January 20 inauguration of President Obama defies all logic. More than one million people are likely to converge in Washington from all across the country for the inauguration of the first African-American president.
Imagine people being flushed with money now. A three-bed rooms house in suburban Virgia is being rented for as much as $57,000 for a week. Same type of facility at Maryland is going for $60,000 a week.
THE General Motors (GM), one of the three giant US automakers -- all three of them in knee-deep trouble due to shorn of capital -- is set to sell its assets in Europe to shore up its dwindling capital base. All three carmakers vainly sought financial aids from the government.
The GM intends to raise $257 million by selling its properties in Europe. Running critically short of cash, GM is making a global push to add upto $4.0 billion to its almost empty coffer. The company is in such a distress that it is even contemplating selling its Detroit skyscapper complex that serves as its head office, all these were revealed by a reputed newspaper last Friday. The price of the commercial properties have dropped about a quarter this year.
Analysts predict that given the current gloomy market, the automaker would find it difficult to meet its target. They went on to add that even $4.0 billion the automaker is trying to raise through sale of its properties would not be enough. The company has burned $6.9 billion in the third quarter.
Meanwhile, Finance Minister of France Christine Lagarde has disclosed that government plans to underwrite $6.0 billion of credit insurance for risky companies to try to prevent a collapse of confidence in lending between businesses.
The Panasonic, the Japanese electronic coglomerate announced that its operating profit will come down by 40 per cent. This will reawaken fear that its rivals Sony and Toshiba are also facing trouble. Sony had earlier announced a 57 per cent drop in its operating profits. The maxim honesty is the best policy is being reversed. A British Airways executive facing the threats of gaol, because of fixing fuel price, has been promoted to the company's board.
Former UBS executives have paid back or forfeited bonuses amounting to $58 million as banks across the globe are under mounting pressure to limit executive compensation after being bailed out by tax payers money.
Bank executives in Goldman Sachs, Deutsche Bank and Barclays have all agreed not to take bonus. The Wall Street firms are pledge-bound not to pay their executives any bonus out of the fund received from the government.
In America, shopping season got underway from Friday as nation's retailers went into a price-cutting frenzy.
Such famed retail outlets like Macy's and Gay and Lord are offering rebates upto 50 per cent. A set of diamond earrings priced at $700 is now being offered at $249. Saks at the 5th Avenue in New York is the most expensive retail outlet in the world. A mark Jacob bag originally priced at $995 is now being sold $248.
A Ted Baker suit at Lord and Taylor priced at $895 is now available at $399. For weeks they ( retailers )have been trying to undo one another to capture the attention of the consumers who have become dumb to the wooing, the New York Times reported last Friday. Like in Eid in Bangladesh the retailers here in America make about 40 percent of the annual earnings during this festive season. Retailers are hoping against hope to make some money.
Amidst this gloomy economic scenario, the rush for booking rooms in hotels and apartments in Washington for the January 20 inauguration of President Obama defies all logic. More than one million people are likely to converge in Washington from all across the country for the inauguration of the first African-American president.
Imagine people being flushed with money now. A three-bed rooms house in suburban Virgia is being rented for as much as $57,000 for a week. Same type of facility at Maryland is going for $60,000 a week.