01/01/2012 by admin.

What a year 2011 was for the world stock markets.

The United Kingdom’s FTSE 100 fell 5.6 per cent in 2011, while France saw stock falls of 18 per cent and German stocks fell 15 per cent as fears for the survival of the euro bit. But United States stocks ended 2011 up. The euro has ended 2011 close to a 15-month low against the US dollar.

The crises in the eurozone has had a huge impact on world markets, as investors await a plan to ensure that Italy’s government can continue to support its mounting debts. The United States and Europe, including the United Kingdom, have had to accept that it may be many years before their debt ridden economies get back to normal.

Also in 2011 the United States lost its AAA credit rating, following deadlock in Congress over raising the country’s debt ceiling - or the legal limit on the federal government’s total borrowing.

But 2011 has been dominated by the euro crisis and the euro ended the year close to a 15-month low against the dollar after it shed more than 3 per cent last week. Many analysts suggest that it could drop even further in 2012.

France and Germany could bear the brunt of any bailout costs for the southern European states - and this has been reflected in the performance of their equity markets.

France’s Cac 40 dropped 17.5 per cent and Germany’s Dax fell 14.7 per cent in 2011. The United Kingdom’s FTSE 100 index is 5.6 per cent lower on the year, worries over the impact of the eurozone crisis did most of the damage.

Will 2012 be any better?

Posted in Finance | 1 Comment »

08/10/2011 by Fin.

The Bank of England is going to inject £75bn into the economy through a process known as quantitative easing (QE). The Bank has already used QE before previously pumping £200bn into the economy by buying assets such as government bonds, to try to boost lending by commercial banks.

All of this money will go to the banks because supposedly that is the best way for the money to filter into the economy. But I am sure that it would be better to give everybody in the country about £4,000 to spend how they wish. For example they could spend it on upgrading their bathroom or buying a new TV, which would all help the economy in a different sort of way. This is much better than seeing the banks get it and sit on it, and still not even lending to small businesses.

In October 2008, the world’s financial system was on the brink of collapse. Even with the announcement of a multi-million pound bail-out, major British banks were about to go bust.  Gordon Brown came up with a plan which was at the time heralded as saving the European banking system. The government bailed out the faltering banks. But here we are again in the same situation.

Moody’s has just downgraded the credit rating of twelve financial firms in the UK including RBS, Lloyds TSB, Santander UK and Nationwide. The sticking plasters seem to have all fallen off and the culprits have taken all the credit and moved on, leaving an even bigger mess.

Is this the end of Capitalism?

Posted in Finance | 2 Comments »

09/07/2011 by admin.

Hi, here we are again, in a sleazy turmoil. Of course I mean the recent hacking scandal. After sleazy banks and sleazy MP’s, we now have a treble dose of sleaze - sleazy press, sleazy police and, once again, sleazy MP’s. Also to top it off we now have yet another sleazy Prime Minister.

In any business there is a need to stay ahead of the competition and you can do this legally and fairly, or illegally and by cheating. Phone hacking has given certain newspapers the edge regarding their competition. That competition also includes online news companies. Falling sales of high street newspapers signifies that there is a war going on in the news print industry. The saying that “anything’s fair in love and war” seems to have been taken to heart.

I really wish people would stop buying papers like the News of the World, but this society of Hero Worship needs to be fed. A couple of years ago some primary school children were asked what was the biggest thing that worried them about their parents. The children unanimously said that their parents preoccupation with celebrity status.

There have always been people in the past that have shined for all sorts of reasons and they rightly go down in history and are much talked about for doing amazing things, right or wrong. But the stars of today seem to be shallow and squalid and overpaid and they seem to be everywhere. On every TV channel, levering their way into every form of media they can.

We have a wonderful country, a green and pleasant land, but certain greedy people are screwing with it all.

Posted in Politics | 2 Comments »

06/06/2011 by neilwilliams2009.

Recent reports show that the euro is losing grounds to sterling. From March, it was seen that while sterling is gaining in momentum, the euro has started to stagnate. The euro slipped by 0.2% to around 85.88 pence. The euro has been rising steadily in value and in the month of January of 2011 it was seen to be around 86.72 pence. The rise in Euro till now has been mainly because Europe’s requirements of debt help has been much lower in comparison to that of U.S.

Status of the Euro

A few years back, the euro was seen to be rising constantly in importance so much so that the market watchers were of the opinion that euro might supplant the dollar as the world’s most important and dominant reserve currency in about twenty years.

At the same time the value of dollar has been sliding down from the time of the recession in 2007. The U.S. deficit ballooned to around 5-6 per cent of the GDP in the recent years and in addition the US debt to the rest of the countries rose to around 20 per cent of the GDP. The importance of euro increased because of the economic policies of the U.S. and because of the scope of expansion of the euro zone. According to the financial experts, if the thirteen members of EU join the European Economic and Monetary Union or EMU by 2020, including UK or United Kingdom, euro may gain importance as the reserve currency.

During 2010 the euro was in much better position than dollar. This rise continued untill February of this year. But the continuous rise halted in March as the sovereign debt worries returned. Experts are of the opinion that the high oil price and the expectation that the euro zone will have higher interest rates may go in the favor of euro. On the 7th of March (2011), the euro rose against the dollar above $1.40 but it faded as the liquidity in London began to dry up during the day. As reports by Reuters, the euro was last seen at $1.3971, which is down by 0.1 per cent. So, euro remains at about 4.3 per cent. In comparison to euro, sterling has been rising steadily. It gained points over the euro in March itself.

The President of the European Central Bank said that the euro zone interest rates may rise by next month and this may also help the euro in maintaining its rise. However, the economic experts are of the view that if no one is able to find a resolution for the euro debt problem, then the euro could fall. The sovereign debt concerns have been dominating the economic and the political scene for the last few months. Most of the economies in the euro zone are still struggling with stagnating growth and comparatively high debt burden. These countries are in need of urgent debt help.

As a result of this debt problem, the countries may incorporate tighter monetary policies. This in turn may put a stop to the rise of the euro and limit its gains.

Posted in Finance | 2 Comments »

05/06/2011 by JohnB.

The cost of going bankrupt rose by £75 to £525 at the beginning of June 2011 and with the court fee added on, the total upfront cost of going bankrupt is now about £700. The Insolvency Service has said this increase was to cover the cost of administration.

I actually think that this is a good thing because I know of people who go bankrupt at the drop of a hat. Some I know have done this three times now.

When I was younger my mother made sure that I knew how important it was to pay my debts and how that reflected upon me as a person to trust. I have struggled to pay off debts at times in the past but at present I don’t owe anybody anything and would never dream of having debts “written off”, I always take pride in paying my way.

I am convinced that some people borrow money clearly intent on not paying it back and using “bankruptcy” to achieve this.

Posted in Finance | 2 Comments »