Pension funds in the western world have made am almost one trillion pound ($1.5 trillion) recovery in the first half of 2009. Whilst commendable, this figure represents less than a third of what these funds have lost in market value last year. These figures were released by the Organisation for Economic Co-operation and Development (OECD) who have been tracking the progress of pension funds since the outset of the global economic turndown. According to the OECD who is based in Paris, the recovery in pension fund performance has continued through September 30, 2009, on the back of strong equity returns. However it will take some time before the losses that occurred during 2008 are fully recouped. Most pension funds staged a partial recovery in the first half of 2009, generating investment returns of 3.5 percent in nominal terms. Membership of OECD is made up from mostly financially developed industrialized economies

The cost of car insurance appears to be dramatically on the rise, according to a recent survey from the Automobile Association (AA) in the third quarter of 2009, insuring a car rose at its fastest pace in 15 years, driven by a spate of rising personal injury claims and exacerbated by fraud. Statistics issued by the AA show that the average quoted premium for comprehensive motor cover rose 5.6 percent to £821 pounds during the three months to September 30, and by 14 percent from 2008.

As news filters through to the market that Virgin Money has applied for a banking license through the FSA (Financial Services Authority) it now appears more than likely that Virgin Money will make an offer for part or all of the Northern Rock business, with many analysts claiming that an informal agreement has already been struck with the UK government, and all that is required is tie up a few loose ends before the deal can be officially announced. Speculation in banking circles point to the fact that the UK government will need to request a high asking price for Northern Rock. Any sale at a "knock down" price is bound to infuriate taxpayers whose money was used to keep the Rock from sinking. On the other hand, Branson’s company is not liable to pay an inflated price for the bank. This could lead to an impasse that could see the operation stay with the UK government for the foreseeable future. Analysts state that selling Northern Rock would be in the best interests of both the government and UK taxpayers, but only in the medium to longer term. With an election looming, questions remain whether Gordon Brown’s government could allow themselves such a luxury.

Discount retailer, Matalan is reputed to be weighing up a £1.5 billion offer, after a number of companies expressed their interest in acquiring the business which remains privately owned. Among the parties interested are private equity group CVC. Matalan were taken private by John Hargreaves, their founder and controlling more than three years ago with indications having it that Hargreaves is neither interested in entering into an auction to sell his company or at any price.

The employee owned department store chain John Lewis, has seen online sales of its clothing range, take tremendous steps forwards since the company re- launched their updated website last month. With the launch came the release of a wide range of new fashion brands exclusive to the company. A leading executive from John Lewis Direct announced the company’s satisfaction with results achieved till now, that far surpassed their predictions. In general, sales of clothing online from the company were about three times higher than last year.

Mobile phone company Orange are due to begin marketing the iPhone to UK customers in Early November, a move that is bound to mark strong competition with O2 as the Xmas run up gets under way. Orange’s announcement last month that it had become the first UK network breaks O2’s exclusive hold on marketing the iPhone device, caused shock waves in the industry. The iPhone is expected to be launched by Orange on 10 November, just one day after O2’s two-year exclusive contract with Apple ends. Carphone Warehouse, which was the only independent retailer able to stock the iPhone when O2 had it to itself, is also expected to sell the phone on behalf of Orange. The iPhone is seen as the best touchscreen phone in the market, and has won a clutch of industry awards.

In the money markets, Sterling was back on a rise against the leading currencies with the notable exception of the Swiss franc.

• Pound/US dollar 1.6322
• Pound/Euro 1.10979
• Pound/Japanese Yen 150.2587
• Pound/Swiss Franc 1.6629

The FTSE 100 suffered a late reaction to the news that the UK economy was still in recession, falling 50.83 points to close on 5191.74 on Monday. The FTSE 250 was also down by 137.55 points to 9186.10.

The world’s largest construction equipment maker Caterpillar, has announced their intention to permanently cut 2,500 jobs in the US. The news was a contradiction to predictions that economic recovery was on its way for the construction industry in general and Caterpillar in particular, with the company undertaking to reinstate 550 workers that they had previously laid off. During the downturn, Caterpillar has cut about 34,000 jobs globally.

On Wall Street, the Dow Jones also continued to decline, down a further 104.22 points to 9867.96. At the same time, the NASDAQ Composite index appeared to be on a never ending but steady decline, yesterday down a further 12.62 points to close on 2141.85

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Tags: AA, Automobile Association, Bank, Banking, British Economy, British Pound, car insurance, Caterpillar, Currency, CVC, Dow Jones, Economics, Economy, Employment, Financial News, Financial Services Authority, FSA, FTSE, Gordon Brown, iPhone, John Hargreaves, John Lewis, Matalan, Mobile phone, Money, Money Markets, NASDAQ, Northern Rock, O2, OECD, Orange, Organisation for Economic Co-operation and Development, Pensions, Recession, Retail, Stock Markets, UK Banks, UK Economy, UK government, UK Recession, Virgin Money, Wall Street

In a move believed to be to block Italian auto giant Fiat from acquiring the European brands of bankrupt General Motors, Opel and more importantly for the UK, Vauxhall Motors is to be acquired by Magna. The huge Canadian car auto parts maker

GM made the bold decision on who could buy Opel/Vauxhall also under pressure from the German government who have undertaken to invest several billion Euro to support the firm and its more than 25,000 German workers, Action was frantic over the weekend as Business Secretary Peter Mandelson announced that he will be seeking an early meeting with representatives of Magna who already employs around 75,000people worldwide, including in their plants in Austria.

Mr. Mandelson emphasized that Magna had made it clear that should they be successful in their bid to acquire Opel/Vauxhall, they would remain committed to continued production by Vauxhall in the U.K. Mandelson also went on to add “Now I will be seeking to reinforce their commitment and to make it into a cast-iron guarantee.” It appears obvious that the UK government will need to finance their commitment in line with their counterparts in Germany who are expected to provide around one billion pounds in interim financing for Opel, an undertaking that largely paved the way for a takeover by Magna along with two Russian partners.

UK Union officials as well as MPs have already expressed certain uneasiness around the possibility that the rescue could see German jobs safeguarded ahead of those in the UK.
To probe that there is still life in the car industry, Japan’s second- largest carmaker Honda Motor Company have announced plans to resume production at its U.K. plant after a four-month shut-down.

What set the production lines rolling was not an increase in demand for Honda cars, but the undertaking from workers at the Honda factory, situated in Swindon, southern England, to accept a three percent pay cut to be held until spring of next year. Honda’s UK Managers have caught on to the idea, also agreeing to take a five percent cut in pay.

The plant reopens on a single daily shift basis, understandable when you consider that car sales in the U.K. have plunged by 24 percent in the last twelve months. Mobile phone operator, Orange have reportedly made an unsuccessful offer to acquire for T-Mobile’s British operations. T-Mobile’s are the UK’s fourth-largest mobile communications network, are instead expected to launch a restructuring of the business in attempt to add some life to the company’s fortunes which have been far form healthy of late.

Vodafone are also reported to have expressed an interest in acquiring is also T-Mobile UK. Rumours have it that they would be interested in trading their Turkish franchises with Deutsche Telekom which may be more appealing to them, as DT already control Greek operator OTE.

On Friday the FTSE 100 Index rose 30.40 points to 4,417.94 while the FTSE 250 closed on 7,572.00 Sterling took a step forward against the dollar on Friday, maintaining its rise above the $1.60 mark. It also increased it steady rise against the rest of the major currencies.

· Pound/US dollar 1.6205
· Pound/Euro 1.1466
· Pound/Japanese Yen 155.1385
· Pound/Swiss Franc 1.7428

As has been widely forecast, the last icon of the American industry, General Motors will file for bankruptcy protection later on Monday, officially marking the most significant failure of any industrial company in the history of US commerce.

Unconfirmed reports have it that a majority of bondholders have agreed to a compromise that will give them a minimum ten percent stake in a new, smaller, leaner and hopefully more efficient GM that will arise from the ashes.

The Dow Jones closed for the weekend still moving upwards, 96.53 points to 8500.22, while the NASDAQ stuttered a further 15.1 points recovered to close on 1751.79

Crude oil prices continue to rise, hitting a new six-month high, as US stockpiles continue to be exhausted, on demand by an economy that is definitely showing signs of recovery.
Light crude climbed $1.23 to close Friday trading at $66.31 a barrel.

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Tags: British Economy, Employment, Financial News, Honda, Mandelson, Mobile phone, Vauxhall