The International Monetary Fund (IMF) has stated that governments must act to curb the increasing power of banks in the aftermath of the financial crisis. The IMF has called for cooperation from governments to set out future financial regulatory reform agenda, whilst stressing that some of the "too-big-to-fail" institutions had been made even stronger by the financial crisis. The IMF went on to warn that the large government financed deficits run-up during the financial crisis could pose a risk of starting a second credit crunch.

Proposals from the IMF include imposing two new taxes on banks in order to raise funds to pay for potential future bailouts and to penalise excessive profit-making. UK Chancellor Alistair Darling was reported as having welcomed the proposal:

Recent reports show that the number of Britons buying a home for the first time fell to the lowest in almost two decades as tighter lending conditions curbed people’s ability to purchase property. Some 347,000 first-time buyers took out a home loan in the year through February, less than half the peak figure of 700,000 recorded in the period from 2004 to 2005. Reasons given largely include the bank’s policy of squeezing credit as they seek to rebuild their balance sheets To aid first-time buyers, the government last month scrapped a tax on house purchases for those spending less than £250,000 pounds ($384,000) which help a few buyers, However many don’t have the 25 percent deposit lenders that lenders now demand

Official data released on Wednesday showed that the number of people in the U.K. claiming jobless benefits has fallen further than anticipated in March. Overall unemployment rose above 2.5 million, reaching its highest level for more than 15 years. The data drew conflicting responses from the main parties ahead of the May 6 general elections. The Office for National Statistics said the number of people receiving jobseekers allowance fell 32,900 in March to 1.54 million, the fourth decline in five months.

Britain’s largest supermarket chain Tesco has announced plans to l create 16,000 jobs this year, after the company announced a 10 per cent rise in profits for 2009. Tesco pledged 9,000 new jobs for the UK as they confirmed pre-tax profits of £3.2 billion for the financial year to 27 February 2010. 2009

saw a record turnover of £56.9 billion for the retailer, which have now almost trebled in size over the past decade and currently employs 460,000 people in 14 countries. . The company’s non-food business generated £9 billion in UK revenues alone

In a bid to expand their share in Europe’s growing market for the auto rental service, the American company Zipcar Inc. has announced that they are to acquire UK car-sharing peer Streetcar Ltd. The acquisition, valued around $50 million, will give Zipcar a larger presence in the U.K., where Streetcar is the biggest car-sharing company,

Zipcar began operating in London in 2006 and has 12,000 U.K. members who pay a fee to rent cars by the hour or day while Wimbledon based Streetcar, based in Wimbledon, has 50,000 members in the U.K. Its revenue last year was about $25 million.

Online fashion retailer ASOS have announced that they anticipate profits of around £20 million pounds ($32.09 million) after an increase of turnover of around one third to £223 million for the year to the end of March. A spokesman for the company announced "another excellent year" and that ASOS are approaching this year with considerably more confidence."

Tui Travel announced that they have raised £500 million of fresh financing in anticipation of cash flow problems in the wake of travel disruption caused by the volcanic ash cloud. The holiday operator warned yesterday that it was losing up to six million pounds a day. A spokesman for the company said the new finance would be largely used to "exploit its strong pipeline of attractive acquisition opportunities". Analysts said the finance would also allow Tui Travel to partially repay a £600 million pound loan that they took from Tui AG, the German travel group who are majority shareholders in Tui Travel.

Sterling rose to a two-month high against the euro and advanced against the dollar on Thursday after the minutes of the Bank of England’s policy meeting earlier this month showed a more positive outlook. The pound closed against the dollar on 1.5388 while the Euro stood at 1.1157

London’s FTSE 100 failed to keep intraday gains on Wednesday as a recovery rally among banks faded coupled with concerns about the potential impact of the disruption caused by the volcanic eruption in Iceland on the recovering economy.

London’s benchmark index fell 62 points, to 5,665.33, turning round from modest opening gains as financial stocks joined resource companies at the bottom of the market.

US President Barack Obama has again attacked critics of his banking reforms. In a speech which warned that without change the financial crisis will be repeated, Obama pointed out that reckless practices and financial firms that acted like "bandits" should never be allowed to operate again.

Regulatory reform was in the financial sector’s interests, the president said adding that "bankers and lobbyists should not fight against it ".

President Obama made his speech to an audience of bankers and financial experts in New York

US stock prices dropped on Thursday after rising on Wednesday morning, boosted by earnings results from Apple that smashed analyst expectations, with Morgan Stanley and Boeing also posting higher than anticipated first-quarter figures. The Dow Jones Industrial Average closed on 11,134.29 while the Nasdaq Composite was up on 2,509.10.

Apple led the technology stocks in the Dow higher, rising 6.3 per cent as the company reported a 90 per cent increase in second-quarter profit and a 49 per cent increase in revenue after the session’s close on Tuesday, far surpassing analysts’ estimates. The consumer technology products group had been expected to record sales of around $12 billion; instead, it reported sales of $13.5 billion in the first quarter.

Software giants Microsoft announced a profits leap by 35% in the first three months of 2010, largely due to the continued success of their Windows 7 operating system. Microsoft’s net profits for the quarter of £2.6 billion ($4 billion) were also attributed to "strong growth" from its Bing search engine business and XBox Live. Sales hit a record $14.5 billion, up 6% on the same period in 2009.

Doing less well were Yahoo, whose share dropped by almost five percent as the search engine provider forecast lower-than-expected second-quarter sales citing losing market share.

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Tags: Alistair Darling, Apple, ASOS, Bank, Bank of England, Banking, Bing, Boeing, British Economy, British Pound, Dow Jones, Economics, Employment, Financial News, FTSE, International Monetary Fund, Microsoft, Morgan Stanley, Office for National Statistics, Retail, Streetcar Ltd, Tesco, UK Banks, UK Economy, UK government, Unemployment, Windows 7, Xbox Live, Zipcar Inc

Blame can be attached to UK Prime Minister Gordon Brown for many of the nation’s financial woes, rightly or not. On one fact, however, there is a consensus. That he had the foresight to keep the UK out of the euro. The recent financial crisis has shown that the structural weakness of the eurozone, which already seems to be crumbling, with the Greek tragedy exposing the weakness of a system of "mutual guarantees" by 16 different fiscal regimes. Opponents of the UK joining the single currency are basking in the light of their wisdom, but the smiles may soon be wiped from their faces, as it looks like Britain may be pulled into the crisis indirectly. This may happen if the International Monetary Fund (IMF) gets involved although the UK will be nowhere near the front line of a rescue package, unlike the Germans and the French.

Rumors that the problems that Greece, Spain, Portugal and Italy are experiencing– will lead to a break-up of the European currency is far-fetched. Above anything else, the single currency is a Franco-German political project with huge symbolic investment for postwar, post-Iron Curtain Europe.

The problem for Greece and the other Mediterranean counties is that their membership of the single currency means that they cannot devalue its way out of difficulty.

The UK Secretary of State for Business, Lord Mandelson has predicted that a decision on government funding to help rescue the car manufacturer Vauxhall could be completed within weeks. GM.UL is said to be looking for an investment of £2.9 billion pounds from European governments to facilitate a return to growth. Mandelson confirmed that the government is prepared to play a part in the rescue plans and that negotiations have started over what conditions could be imposed in return for government support

Difficult though it may be to accept, a recent survey on the banking sector has revealed that 57 percent of UK bankers and financiers received a bonus increase during 2009. The poll, which took in close to seven hundred financial professionals indicates that the Chancellor’s "super tax" on bankers’ bonuses had caused little effect on lavish remuneration packages.

More than a third of the bankers in the poll saw their bonuses either decrease or at least remain static. However those who fell into the this category did not cite the super tax to be the primary reason for the absence of an increase, preferring to cast the blame, and rightly so, on the performance of their companies with half of those who did miss out on a bonus were reported to be less than satisfied.

Prominent UK property developers the Shaftesbury Group have announced a major upturn in demand for property in the West End of London, with the Christmas and New Year period especially brisk. Shaftesbury announced a significant increase in new tenant agreements approved at rates at or above recent property values for the company’s various assets. While many UK property companies still struggling to honour their various banking covenants, the overall picture denotes that the UK property tide has turned, the company reports.

Lloyds Banking Group (LBG) is looking to sell or spin off major assets from the failing £70 billion pound property. The bank is establishing a review process, which currently in its early stages. The process will seek to reduce the amount of regulatory capital tied up in keeping the assets on Lloyds’ balance sheet, with the strategy expected to be finalised by Easter. At the same time, Lloyds plan to step up their sale of HBOS Integrated Finance, an investment business with stakes in about 60 companies.

Meanwhile the Royal Bank of Scotland (RBS), remain sitting on losses of several hundred million pounds after being forced to take back ownership of £1.8 billion in German properties bought at the market’s peak by a fund run by Morgan Stanley. In one of the largest paper losses on property for a UK bank, RBS has taken control of a portfolio of 28 German properties, after lending about €1.9 billion to acquire the portfolio in 2007. RBS are to follow the trend set by LBG to hold on to the properties until they return at least some of the losses..

Mobile telecommunications operator O2 believes that its purchase of Jajah, an Israeli voice over internet protocol (VoIP) company, will help the firm out- perform rival mobile operators and the current VoIP market leader Skype. A spokesman for Telefonica Europe, O2’s parent company, said that the company will use Jajah to attack the international calling card market, currently worth £100 million pounds a month in the UK, rather than to slash mobile call costs.

Fashion chain New Look are giving a lot of indications that they will become the third company in as many days to scrap a planned stock market flotation. The writing seems to be on the wall for New Look’s float, when they called off a proposed £1.7 billion initial public offering (IPO) on Friday, blaming a lack of appetite among potential investors. New Look had planned to raise a total of £650 million pounds from their IPO, using the money to cut debt as well as fund an expansion programme in the UK and overseas.

As the FTSE 100 was switched off for the weekend UK, stocks had receded a little The 100 Index was down 10.03 points to 5,142.45

The pound rose slightly against the dollar, closing at 1.5702 while jumping to 1.1522 against the struggling Euro.

President Barack Obama has signed a law increasing the limit on how much the US government can borrow.

The debt limit was raised to $14.3 trillion (£9.1 trillion) from $12.4 trillion, which will allow the government to function for the rest of the year.

Correspondingly Mr Obama also approved legislation that requires new spending to be offset with cuts elsewhere. The legislation will seek to address the record US budget deficit, which is predicted to reach $1.56 trillion in 2010.

The "pay-as-you-go" or "paygo" rule was in place in the 1990s – the last time there was a federal budget surplus.

On Wall Street things were still looking up. The Dow Jones Industrial Average finished for the weekend up 41 points at 10099.14. The NASDAQ gained 33 points to close on 2,183.53.

According to the US Commerce Department, retail sales rose at a higher rate than expected in January, boosting hopes that strong economic recovery will continue. Sales grew 0.5% month-on-month, while December’s figure was revised to a 0.1% fall from a first estimate of a 0.3% fall.

Sales were up by 4.7%, Compared with January 2009.

According to preliminary figures released on Friday, Germany’s recovery from recession faltered in the final quarter of 2009, failing to show any signs of growth at all in the last quarter of the year. France did better, reporting a 0.6% rise in GDP for the same three-month period which was higher than forecast. The figures released also showed that the economy in the Eurozone also grew 0.1% in the same quarter.

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Tags: Bank, Banking, Barack Obama, British Economy, British Pound, Currency, Dow Jones, Economics, Economy, Financial News, FTSE, Gordon Brown, HBOS Integrated Finance, International Monetary Fund, Jajah, Lloyds Banking Group, Lord Mandelson, Money, Morgan Stanley, NASDAQ, New Look, O2, Recession, Royal Bank of Scotland, Shaftesbury Group, Skype, Telefonica, UK Banks, UK Economy, UK government, UK Recession, Vauxhall, Wall Street

According to a recent survey conducted by the Confederation for British Industry (CBI), around a third of the UK financial services companies were said to be more optimistic about their situation and that of the sector in general. This makes for the third consecutive quarter that confidence has risen in the financial services industry, making for a 100% increase since the middle of 2009. The increased optimism comes despite slightly weaker volumes being recorded than forecast in the fourth quarter, coupled with some fears that business will contract in the first quarter of this year.

There were smiling faces all around as retailer House of Fraser delivered a trading update on Monday showing a new record for festive sales. Signs that the UK consumer was shrugging off the recession came as the privately-owned department store chain showed sales rising by 7.1 percent in the eight weeks to Jan. 2nd as well as Boxing Day sales figures that were up climbed 27 percent on 2008.

Less happy were the management team at, Tesco, who according to a global study has dropped to fourth place in a league table of the world’s biggest retailers. Tesco dropped one place pushed down by the German retail group, Metro. Sales figures for Tesco for the six weeks to January 9 is expected to report like-for-like sales growth of about three percent for the period.

Some good news for those UK householders whose boilers are rated at G level or lower. In addition to the two combined subsidies from the UK government and British Gas that is liable to cover around a third of the estimated cost of buying and installing a new boiler, British Gas has just added a further £452 in cost savings for those who will be replacing their boiler under the scheme which will come in two forms.

• A set of comprehensive radiator controls for the home or office valued at £248.
• Homecare 200 repairs cover for the boiler costing £204.

Anyone who is liable to receive these subsidies, which in general should include anyone who has a boiler more than 15 years old may be eligible to receive these grants and subsidies, contact British Gas on 0845 074 5991 for a free consolation or click http://www.britishgas.co.uk/yourboiler

Spanish banking group Santander has announced the launch of a marketing campaign aimed at bringing its UK brands under one name. Santander will invest around £30 million pounds refurbishing the 1,000 branches across the UK coming under their label as well as printing new product literature for the Abbey, Bradford & Bingley and Alliance & Leicester banks. To add some glamour, formula one racing driver Lewis Hamilton has been chosen to publicise the company’s new image at a Santander branch to be opened in central London.

Manchester United FC have announced their plans to mount a bond issue intended to raise £500 million in order to refinance the club’s mounting debts.

The announcement came as the club announced pre-tax profits of £48.2 million for the year to 30 June 2009, compared with a loss of £21.4 million last year. The profit was swollen by the £80 million fee received by the club from Real Madrid who purchased the services of Cristiano Ronaldo during the close season. According to information issued by the club’s holding company Red Football Ltd, group turnover rose to £278.5 million from £256.2 million in 2008. Although Red Football disclosed no total debt figure was announced, estimates have it at around £700 million.

British Land has unveiled plans to manage a £300 million pound buy-to-let fund being launched by Charles Russell, the prominent UK law firm. The fund has been established to acquire prime residential real estate in London. British Land will also take a small stake in the fund as the property group rapidly expands its residential business, marking British Land’s first residential investments since selling the majority of its portfolio in 2006.

Revenue at IT services group Computacenter remained weak for 2009, largely due to a shortage of large infrastructure projects. With this factor taken this factor into account, the company instituted a substantial cost-cutting programme which look likely to see them beat profit forecasts for 2009, which could be close to £50 million pounds. On the news shares in Computacenter rose 17.7 pence to 309 pence on Tuesday.

The pound continued its recovery above the dollar in mid week trading, while moving up slightly against the Euro.

• Dollar 1.6207
• Euro 1.118

On Tuesday the FTSE 100 Index fell 0.7 percent, to 5,498.71.

Meanwhile it has been announced that during one of the biggest turn-downs in US financial history the US Federal Reserve announce that they made a profit of $52.1 billion (£32.2 billion) in 2009, marking a rise of 47% over the previous year, allowing them to pay a record $46.1 billion to the US Treasury last year.

The $46.1 billion was the largest amount ever paid by the central bank since it was creation in 1914, and was largely thanks to the Fed’s attempts to support the financial system throughout the ongoing financial crisis.

The Dow Jones Industrial Average closed Tuesday up slightly, nine points to 10,627. The NASDAQ dropped to close on 2,282.

The recently formed US Financial Crisis Inquiry Commission (FCIC) is to hold their first public hearing on Wednesday.

The 10-member panel was established by Congress to examine the causes of the 2008 US financial crisis. The committee will examine the causes of the crisis, and are scheduled to hear testimony on the current state of the crisis from a cross section of private and public sector leaders.

Witnesses will include top executives from Goldman Sachs, JPMorgan Chase, Morgan Stanley and Bank of America.

Findings and the report of the panel are due to be presented to Congress and President Barack Obama by 15 December.

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Tags: Abbey, Alliance & Leicester, Bank, Bank of America, Banking, Barack Obama, boiler, Bradford & Bingley, British Economy, British Gas, British Land, British Pound, CBI, Charles Russell, Computacenter, Confederation for British Industry, Credit Crunch, Cristiano Ronaldo, Currency, Dow Jones, Economy, FCIC, Financial News, FTSE, Goldman Sachs, JPMorgan Chase, Lewis Hamilton, Manchester United, Metro, Money, Money Markets, Morgan Stanley, NASDAQ, Real Madrid, Recession, Red Football Ltd, Retail, Santander, Stock Markets, Stocks and shares, Tesco, UK Banks, UK Economy, UK government, UK Recession, UK retail, US Federal Reserve, US Financial Crisis Inquiry Commission, US Treasury

Retailers won the closely watched holiday skirmish with shoppers, who opened their wallets a little bit despite a still struggling economy, fewer discounts than last year and limited variety on store shelves, according to recently released data. A late boost from last minute shoppers and an extra day of shopping increased total retail sales by 3.6% over the year. According to estimates Shoppers in Britain spent over £130 million pounds online on Christmas Day alone, a 29 percent increase from a year earlier. The number of U.K. customers on Boxing Day, the day after Christmas, also increased, by 19 percent. Retailers avoided last year’s pre-Christmas discounting by cutting inventory to “much healthier” levels, according to Morgan Stanley analysts. Prices, which were slashed by as much as 75 percent in 2008, were down by about 50 percent on London’s Oxford Street shopping district on Dec. 26 at retailers including the Zara clothing chain, House of Fraser Ltd, Bhs and Topshop clothing outlets.

Recent data has shown that demand from house buyers in the UK fell in December for the first time since January 2009, with the number of new buyers registering with agents down 2.2 per cent. The monthly survey showed a slight rise in prices for the month of 0.1 per cent and also noted that about half of all homeowners had no mortgage or owned less than 25 per cent of the value of their home. This is the sole sector of the community said to be behind the increased demand for new houses.

Britain’s recovery from recession has so far been sluggish compared with other developed nations but stronger growth in 2010 should help it narrow the gap. The UK economy is forecast to shrink 4.5 per cent this year and Consensus Economics says that the consensus forecast is for a rebound of 1.4 per cent in 2010. The UK looks set to lag behind the recovery in the US where the consensus forecast suggests growth of 2.7 per cent. The sharp fall in the value of the pound will help UK exporters and the manufacturing sector will see a projected growth of 2.1 per cent.

Recent research has revealed that only one-in-three British businesses believe that plans by Lord Mandelson to boost production industries will do any good. In the survey of 57 manufacturers, only 20 said that the business secretary’s programme of ‘industrial activism’ was likely to benefit UK manufacturers. The remaining 37 said the programme would not help the sector or were unconvinced about its outcomes. However, there was better news regarding manufacturers’ expectations of an industrial recovery, with almost two-thirds of those polled saying the sector was in line for an upturn in 2010.

A spokesman for the Anglo-Dutch steelmaker Corus has said that Britain should shrug off worries about the huge government deficit and prepare to spend ‘tens of billions of pounds’ on infrastructure investment to push the economy out of recession. The spokesman went on to add that that the UK needed to draw up a ‘real industrial policy’ that would make the country more attractive to manufacturers. Lord Mandelson’s efforts to encourage ‘advanced manufacturing’ as a way of rebalancing the economy were worthy of praise, while stating that these initiatives did not go far enough, and that investment programmes should also railways, schools, roads, hospitals and other public amenities.

Virgin Money is reported to be in advanced talks to buy a small UK bank, which will provide an opening for the company to be granted a banking license, completing the Virgin’s long-standing ambition to provide a full range of financial products, including mortgages and current accounts to the British consumer.

The FTSE was closed on Friday as the market awarded itself a long weekend for the Festive Season.

Sterling remained below the $1.60 level on Fridays trading, although rising a little, whilst falling slightly s against the Euro

• Dollar 1.5962
• Euro 1.1089

A resurgent dollar is likely to power through to 2010 with its up-trend intact, as a steadily improving economy leads investors to believe U.S. interest rates will increase sooner than had been expected. The demand for riskier currencies has broken down as the year has come to an end, with the dollar now gaining on positive U.S. data. Analysts predict that the U.S. economy continues to show strength, the dollar stands to strengthen even more.

Wall Street was closed on Friday for the Christmas holiday.

In Japan early Monday the Nikkei average hit its highest close in four months on Monday as stronger-than-forecast output data boosted the manufacturing sector. Adding to the upbeat mood in the market, data before the start of trade showed Japan’s industrial output rose a better-than-expected 2.6 per cent in November, the strongest gain in six months as rising exports to Asia bode well for a recovering economy. The benchmark Nikkei climbed 1.3 per cent, or 139.52 points, to 10,634.23, its highest close since August 26.

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Tags: Bank, Banking, Bhs, British Economy, British Pound, Christmas, Consensus Economics, Corus, Currency, Economics, Economy, Employment, Financial News, FTSE, House of Fraser Ltd, industrial activism, Lord Mandelson, Money, Money Markets, Morgan Stanley, Mortgage, Mortgages, Nikkei, Recession, Retail, Stock Markets, Stocks and shares, Topshop, U.S. economy, UK Banks, UK Economy, UK export, UK government, UK manufacturers, UK Recession, Virgin Money, Wall Street, Xmas, Zara clothing chain

There were one or two petted lips around Westminster yesterday in response to governor of the Bank of England Mervyn King’s call for Britain’s biggest banks to be split up to prevent the possibility of a financial crisis of similar proportions to the one that the UK is going through, in the future. Particularly peeved were Gordon Brown and Alistair Darling who even went as far as rebuking. Mr. King for his comments. King was seemingly unfazed at their comments.

According to Terry Duddy, chief executive of Home Retail Group, owners of the Argos and Homebase chains, the rise in VAT due on January 1 could act as a major for sales of large value items in the weeks leading up to the increase. Whilst announcing that the company had returned to profit in the six months to August 29, , Duddy said went on to announce a rise in consumer confidence and that his company was more optimistic about the outlook for the fourth quarter.

Chocolate kings, Cadbury have subtly increased the pressure on Kraft to raise its proposed £10 billion ($16.6billion) takeover offer. They did so through reporting unexpectedly strong third-quarter trading figures, surpassing even the toughest analysts’ expectations, The Company have succeeded in raising its full-year revenue targets to the “middle” of its 4-6 per cent goal range. Cadbury announced quarterly revenue growth of 7 per cent, which they claimed had been achieved by increasing prices and profit margins, despite a fall in turnover for the period of percent. Correspondingly, Cadbury had made considerable efforts to cut costs and reduce market spending. Since Kraft announced its offer proposal in early September, indications are that investors expect the US food group to pay at least 800 pence per share, while the current cash and shares proposal values Cadbury’s equity at 731pence a share. In the light of the recent results, some investment banks have revalued the target price on Cadbury to 900 pence, however a Kraft offer at this level is considered unlikely, unless counter-bidders suddenly emerge. The consensus is that Kraft will succeed with their offer, if it comes back with a 50-50 split of cash and stock bid of around 825 pence per Cadbury share. Kraft are understood to be considering returning with a formal offer but may wait until after its third-quarter results on November 3, while the UK Takeover Panel has set Kraft a final deadline of November 9 to make a formal offer.

Sterling continued its steady rise against the ever weakening dollar, recovering against the Swiss Franc. whilst faltering against the Euro.

• Pound/US dollar 1.6606
• Pound/Euro 1.1093
• Pound/Japanese Yen 151.6918
• Pound/Swiss Franc 1.6587

The FTSE 100 lost out on some of yesterday’s gains, down 33.79 points to close on 5257.85 The FTSE 250 25 shed all of the previous days gains. Down 143.60 points to close on.9421,04

Morgan Stanley has returned to profit after three quarterly losses in a row, after reporting a net income of £457m in the third quarter of 2008. The bank’s investment banking division fared particularly well with underwriting revenues up 74% from 2008 levels. Meanwhile, Wells Fargo, the country’s fourth-largest bank, reported record $3.2bn profits for the quarter, reporting that revenues from mortgages and consumer credit had surged.

Despite that positive news, the Dow Jones was down for the second consecutive day, yesterday by 92.12 points to crash below the ten thousand points on 9949.36. The NASDAQ Composite index also continued to fall, this time by 12.74 points to close on 2,150.73.

Recent reports continue to speculate that US companies who received billions of dollars of government aid in the financial crisis are to be forced to cut any excessive salary packages awarded to their leading executives. Of the seven companies that received the highest aid from the US Treasury will be obliged to reduce the basic salaries of their 25 best-paid employees, by up to nine tenths of the salary packages, while each firm’s 125 top earners would be see their pay slip cut in half, under the US government plan. There has been widespread outrage in the US over the high level of bonuses paid by firms that not so long ago were forced top go to the government cap in hand and ask for government help to stave of bankruptcy .

Figures just published confirm that China has exceeded its target for economic growth in the third quarter, for the first time this year. Chinese government figures show year on year GDP growth was up 8.9% from 7.9% in the previous quarter. Chinese officials have also said they are sure they will reach their full year target of 8% for economic growth, with the economy grewing by 7.7% in the nine months to September.

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Tags: Alastair Darling, Argos, Bank of England, Banking, British Economy, British Pound, Brown, Cadbury, Currency, Darling, Dow Jones, Economics, Economy, Employment, Financial News, FTSE, Global Credit Crisis, Gordon Brown, Home Retail Group, Homebase, Kraft, Mervyn King, Money, Money Management, Money Markets, Morgan Stanley, NASDAQ, Recession, Terry Duddy, UK Banks, UK Economy, UK government, UK Recession, US Treasury, Wells Fargo

In an unprecedented move, the Department of Health and the Treasury have invited companies in the private sector to submit tenders to take over and run a large National Health Service (NHS) hospital. The contract will be all inclusive, taking in the accident and emergency as well as the maternity wards. The Hinchingbrooke Hospital, in Huntingdonshire comes under the auspices of the East of England strategic health authority who anticipate bids from the NHS as well as the private sector.

Investors are rushing to capitalise on the hedge funds industry’s resurgence resulting in a huge increase in investment in the second quarter. It is reported that more than $142.5 billion has been allocated to hedge funds over the past three months, making for one of the industry’s most significant inflows of client money to date, according to a recent report.

In transport and tourism, signs are afoot of long hard winter ahead, Ryanair, Europe’s largest low-cost people carrier, have announced that they will be cutting their services at their largest bases London Stansted and Dublin. Ryanair are making the cuts as it attempts to cut back on routes that are making losses as well as to benefit from reduced airport charges.

Michael O’Leary, the group’s chief executive, has blamed the cuts on planned increases in air passenger taxes in the UK and Ireland. “Sadly, UK traffic and tourism continue to collapse while Ryanair continues to grow traffic rapidly in those countries that welcome tourists instead of taxing them.” Announced O’Leary.

Despite he recent bout of warm weather and the thirst that it brings, the pace of pub closures in Britain continues to grow. Recent statistics show that closures have risen by a third during the first six months of 2009. In terms of figures, that means that more than 50 UK pubs are pulling their last pint every week.

Local family owned pubs appear to be the most vulnerable , closing their doors at a rate of 40 a week. There are now only 53,466 pubs left trading in the UK compared with 58,600 three years ago.

On the FTSE on Wednesday, tobacco stocks were leading the way, with Imperial Tobacco gaining 2.6 per cent to £16.74.

Europe’s largest drug maker GlaxoSmithKline announced their eagerly anticipated half-year results which turned out better than expected, pushing their share value marginally up by 0.3 per cent to 1163.

Commodities fell after a strong run of the last few days, largely due to profit taking.

In the banking sector, profit warnings from US banking groups Wells Fargo and Morgan Stanley disappointed investors, contributing to losses on the major US exchanges.

Barclays shares fell by 3 per cent to 300p as investors began to shy from its aggressive push towards financial independence, while the other banks also weakened. Lloyds Banking Group lost 3.1 per cent to 71.2p, while Royal Bank of Scotland dipped 0.1 per cent to 39.8p.

Overall shares in London recovered from early losses on Wednesday. The late recovery was attributed to the surprise announcement that US house prices has risen during May.

The FTSE 100 rose 13.13 points to 4,494.30, while the FTSE 250 continued its steady increase, gaining 42.23 points to 7,784.81.

Early falls in sterling following a press report that two UK banks require additional funding were arrested with the announcement that the Bank of England had decided to maintain its asset purchase programme.

• Pound/US dollar 1.6422
• Pound/Euro 1.1578
• Pound/Japanese Yen 154.0592
• Pound/Swiss Franc 1.7528

On Wall Street, there was a flat atmosphere on the announcement that Morgan Stanley had made a loss of $159m (£97m) for the second quarter, a significant setback when compared to the $698m profit the Wall Street bank made in the same period of 2008. Not only was it the third consecutive loss for Morgan Stanley, but it was also much worse than analysts had feared.

Morgan Stanley attributed the loss to the heavy cost of repaying government funding and comes after a number of other major US banks reported significant rises in profits.

The poor results at Morgan Stanley caused a knock on effect , with shares in Bank of America, JP Morgan Chase and Morgan Stanley on the decline.

On Wall Street , the Dow Jones dropped by 34.68 points to 8881.26 while the NASDAQ limped forward a mere 10.18 point to close on 1926.28..

Public sector workers in California were out in protest at the billions of dollars of spending cuts that form the basis of the state’s controversial budget deal.

The cuts, including $6billion in education spending, were reached as part of an agreement to reduce California’s record $26.3billion ,( £16bn) deficit.

Arnold Schwarzenegger, the state’s governor has been forced to write promissory notes to their creditors after running out of money. Public employees have had to take unpaid leave and the state’s credit rating has been slashed to near junk status, giving it the worst rating in the US.

Ahead of the latest US weekly inventories oil prices fell while d gold consolidated below the $950 an ounce level

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Bankers at four leading City firms will share an estimated £6.4 billion Christmas bonus pool as thousands of workers lose their jobs or go on to short time.

Regardless of bringing the world economy to the brink of bankruptcy, employees of London banks Goldman Sachs, Morgan Stanley, Merrill Lynch and Dresdner Kleinwort are expecting huge year-end bonuses.

Banks justify the payouts to best performers by saying if they don’t give them top salaries they risk seeing them go to rivals.

Wall Street giant Goldman Sachs has 5,400 staff in London expecting a £50,0000 Christmas present from their employer, who will share a bonus pot of £1.7billion, even though it plunged to a £1.4billion loss in the fourth quarter.

Goldman had to accept a handout from the US government to keep trading.

Morgan Stanley’s 5,000 London staff are also expected to receive around £50,000 each. The US government handed the bank a $6.4 billion hand out earlier in the £9.7billion in emergency funding from other investors.

Merrill Lynch also came unstuck. Although it has had to be taken over by Bank of America, it has set aside £2billion for performance bonuses, some of which will go to London staff.

German investment bank Commerzbank is taking over rival Dresdner Kleinwort, yet Kleinwort is giving over £350million to bankers and trading staff in London and Frankfurt.

The High Street had some Christmas cheer as tills took slightly more than last week but are still down year-on-year.

The data comes from John Lewis, which publishes sales figures every Sunday based on the previous week’s data.

Their sales in the week to 20 December rose 1.3% from the previous week, but were down 1.8% year-on-year. The week before, takings were down 4% year-on-year.

On the markets, the FTSE ended the week on 4286.90, down 43.8 from opening the day at 4330.7. The DOW ended at 8579.11, down 27.39 from starting at 8606.50.

The pound ended a dismal week at 1.06 euros, down three cents on the day’s trading and down to $1.54 from $1.55.

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