The Organisation for Economic Co-operation and Development (OECD) has predicted that the recovery and growth seen in the second half of 2009 is expected to continue in 2010. Their recent figures show that its 30 member countries, including the US and UK have more than doubled its growth projections for next year. However a spokesman from the OECD warned the developed nations not to expect a smooth ride and that "growth was being held back by still substantial headwinds" and would be restrained for some time in the near future. They went on to explain that some of the very measures that were being used to help the richer nation’s economies to recover might return like a boomerang upon them. The feeling was at the OECD was that the UK, needed to come up with a concrete plan to ease concerns about the stability of their public finances, and that the results that could be achieved through continuing the country’s quantitative easing programme remained uncertain. The UK, which now has overall debt of £825 billion, is set to borrow a record £175 billion over the next two years with further details of how and why due to be set out in Chancellor Darling’s pre-Budget report on 9 December.

US investment bank JP Morgan have announced that they are to complete their take-over of UK stockbroker Cazenove. Morgan are reported to be paying a further £1 billion ($1.67 billion) for the remaining 50% of Cazenove that is not in their hands. JP Morgan and Cazenove reached a joint venture agreement in 2004, where they merged their investment banking operations.

The news that Marks and Spencer have chosen Marc Bolland, current head of Wm Morrison, as its new chief executive, saw a dramatic and immediate shift in fortunes for both companies, at least in stock market terms. Shares in M&S rose 6 per cent to close on 390 pence while Morrisons’ fell by 5 per cent to 281 pence, making for a combined £600 million swing”.

Dutch born Bolland’s appointment puts a long awaited end to the speculation of who will replace incumbent chairman, Sir Stuart Rose, who will remain with the company as part-time chairman until mid-2011.

ITN were expected to reveal the first trading first-ever loss on Thursday as the company launched a set of austerity measures which will be required to put the company back on track. ITN, who produce news bulletins for ITV, as well as for Channel 4, is owned by four media companies, ITV Daily Mail & General Trust, United Business Media and Thomson Reuters, each of whom hold a 20 percent share, except ITV who hold 40 percent. Reasons given for the drop in sales and profit were mainly the recession, which has affected advertising revenues on all commercial broadcasters, and the closure of Setanta Sports News, the news channel operated by the Ireland-based sports channel network that went into administration this year. Revenue from Setanta made up approximately 5 per cent of ITN’s sales in 2008. ITN made a profit of £4.1 million on turnover of £105 million.

Postal and parcel delivery company UK Mail, who only this moth adopted their new trading title from Business Post, have announced a rise in their interim profits, despite of a fall in revenues caused by a recession driven fall in demand. A spokesman for the company pointed out that their parcel business, which holds around a 7 per cent share of the UK market, has witnessed an upturn is sales during the period of postal strikes, as the public began to seek alternatives to Royal Mail’s service. However the company, which also handles around 17 million items of mail a day, said the strikes affected the volumes of mail handled by the company much less significantly than they had hoped for. UK Mail, who relies on the Royal Mail for “last mile” delivery of its sorted post, pointed out that the impact the strikes had been less severe than anticipated.

Sterling lost some of its gains against the major currencies in midweek trading.

• Pound/US dollar 1.6636
• Pound/Euro 1.1163
• Pound/Japanese Yen 148.0862
• Pound/Swiss Franc 1.6881

The UK’s benchmark FTSE 100 index lost the bulk of its early gains for the week, down 78 points to 5,267.70. The FTSE 250 took its usual midweek tumble down 165 points to 9,237.

New home construction in the US have taken a surprise drop fall in October, down 10.6% to an annual rate of 529,000 homes, making for the lowest level in housing starts since April of this year, Reasons for the decrease in demand was put down to .a fall in demand for both single and family housing.

On the news, the Dow Jones average slumped 105 points to close on 10332.42. The NASDAQ also took a tumble, but for reasons of its own and finished the day on Thursday on 2156.92.

Internet giant America on Line (AOL) have announced that they are to lay off more than 2,000 of their staff , representing one third of their entire work forces when it completes its spinoff from Time Warner, with whom they have been in partnership since 2001. Representatives from Time Warner have stated that the separation will be completed by the end of 2009.

Also cutting jobs are Air France-KLM who plans to cut their work force by cut 1,700 during 2010. Their decision comes after the airline posted a worse than predicted third quarter loss of 147 million Euros (£131 million) the job losses are in addition to the 3,000 already cut in 2009.

Silver, platinum, palladium and copper have reached fresh highs for the year while gold continued to extend its record-breaking run breaching the $1,150 mark, seen as the next key milestone in the rally, to reach a record $1,152.74 an ounce, before easing back to $1,148.

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Tags: Air France-KLM, Alastair Darling, America on Line, AOL, Bolland, British Economy, British Pound, Business Post, Cazenove, copper, Credit Crunch, Currency, Daily Mail, Dow Jones, Economy, Financial News, FTSE, General Trust, Gold, ITN, JP Morgan, M&S, Marc Bolland, Marks and Spencer, Money, Money Markets, NASDAQ, OECD, Organisation for Economic Co-operation and Development, palladium, platinum, quantative easing, Recession, Retail, Royal Mail, Setanta, Silver, Stock Markets, Stocks and shares, Stuart Rose, Thomson Reuters, Time Warner, UK Banks, UK Economy, UK government, UK Mail, UK Recession, United Business Media, WM Morrison

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

Contrary to recent forecasts, the International Monetary Fund (IMF), never known for their optimistic approach to the current financial downturn, have cast serious doubts on the Treasury’s hopes of recovering the money spent bailing out UK banks.

A recent report issued by the IMF has stated that recovery rates for past financial crises were just 55% in advanced countries and as low as 15% in emerging economies.

If the statistics are to be applied to the current situation, then half of the money Gordon Brown committed to rescuing the City may never be recovered. However because of the severity of the current crisis, with bank guarantees equivalent to more than a third of gross domestic product having being issued, even 50% may prove to be an optimistic forecast.

Following the start of the crisis in the global financial sector in 2007, the UK banking sector absorbed losses on loans and securities of around £110 billion by the end of 2008 and raised or arranged around £120 billion of new capital by the middle of 2009. Estimates of further losses of around £130 billion from the loan books and securities portfolios of rated UK financial institutions are expected. Meanwhile it has been reported that negative outlook for credit conditions in the UK banking sector will continue for at least the next 12 – 18 months. Expectations are that the sustained weakness of the economic environment in the UK will continue to feed a situation where loan arrears will continue to grow, both in the consumer and business sectors.

The world’s largest mining group BHP Billiton has predicted that global steel demand is liable to double over the next 15 years as the economic “upswing” already being felt in China would be followed by a rebound in growth from developed nations in 2010.

A spokesman for BHP said that China’s recovery has been stronger than expected and there was little sign that their momentum had stalled during the financial downturn of the last 12-18 months.

China is BHP’s most important customer accounting for 20 per cent of it’s around £30 billion in sales in 2008-09.

The UK’s FTSE 100 index also achieved its highest close for almost a year, rising 22 points to close at 5124.3 while the FTSE 250 rose on Wednesday by 52.60 points to 9305.24.

The pound, after taking a beating over the last few days, made a minor recovery yesterday.

• Pound/US dollar 1.6509
• Pound/Euro 1.1202
• Pound/Japanese Yen 150.504
• Pound/Swiss Franc 1.7031

Shares on Wall Street continued upwards thanks to better-than-expected industrial production data.

The Dow Jones Industrial Average closed up 107.5 points at 9,791.71, which makes for an 11-month high. It has now risen for eight of the past nine days. The NASDAQ also moved on up, this time is thirty points to 2133.15.

US consumer prices rose in August from July but analysts said the risks of inflation in the economy remained low. The Consumer Price Index rose 0.4% last month having been flat in July.

The Organisation for Economic Co-operation and Development (OECD) have predicted that the global recession could eventually cost the jobs of 25 million people, despite recent signs that economies of its 30 member countries may be starting to recover.

Fifteen million jobs have been lost so far, and according to the OECD up to 10 million more could go by the end of 2010.

The unemployment rate across the 30 most industrialised nations in the OECD was 8.5% for July 2009, the highest since World War II, having risen from an all-time low of 5.6% at the end of 2007.

Gold extended its push beyond the $1,000 mark on Wednesday, closing in on the record price set last March as bullion was boosted by renewed dollar weakness and concerns about the outlook for inflation.

Gold traded at $1,015 a troy ounce in London, after settling at the end of Tuesday’s session in New York at $1,005.90, its highest ever closing price.

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Tags: Bank, Banking, BHP Billiton, British Economy, British Pound, Currency, Dow Jones, Economics, Economy, Financial News, FTSE, Gordon Brown, IMF, International Monetary Fund, Money, Money Markets, NASDAQ, OECD, Organisation for Economic Co-operation and Development, Retail, Stock Markets, Stocks and shares, UK Banks, UK Economy, UK government, UK Recession, Unemployment, Wall Street

It now appears that the global economy is recovering at a much faster pace than many expected it would. However it appears that making up the rear, and probably by a distance, will be the UK economy that just can’t seem to shake itself out of the doldrums.

According to the Organisation for Economic Co-operation and Development (OECD) the UK economy is even liable to contact by 4.7% this year, a scenario which is much worse than predicted by the UK Treasury who called the rate of decline at 3.5% decline.

The OECD predicts that both the US and the Eurozone to officially call and end top their recessions by the end of the third quarter, encouraged by a series of positive financial indicators in recent months.

.Meanwhile UK financial analysts explain that the UK stodgy economy has been brought about by the fall in the growth for 2009, which has been driven entirely driven by to terribly negative downturns in fourth-quarter 2008 and first-quarter 2009, while forecasts for the UK in the third and fourth quarters of 2009 are, in fact, slightly better than were originally predicted. However they are not sufficient to pull the UK out of the recession.

Meanwhile UK Chancellor, Alastair Darling, forever thinking one move ahead, fears that Germany and France, having returned to a position of economic growth, will begin to reduce their stimulus spending.

Darling is determined to push the G20 nations to take whatever measures necessary to combat unemployment. He expects them to take similar measures to Britain’s £5 billion jobs package, as he is concerned that if the stimulus package is pulled away too soon, the return to growth might fizzle out.

Chancellor Darling is due to attend a meeting of G20 finance ministers in London on Friday and Saturday, prior to a global recovery debate to be held in Pittsburgh in three weeks, where he and Prime Minister Gordon Brown will be in attendance

Recent reports have shown that the service sector expanded at a faster rate in August than expected, adding further hope that the economy is recovering, albeit slowly.

This piece of positive news was offset by a warning from the financially embattled West Yorkshire Welcome Financial Services that the company may have to shed a further 500 jobs as it continues its battle for survival.

Yorkshire based Cattles, who own the company, are burdened by debts of over £2.4 billion and are under scrutiny due to accounting irregularities, have announce plans to close 30 of its 180 Welcome branches as well as reducing the number of employees in their s sales and support teams.

Cattles have already closed its Welcome Car Finance car loans business cutting more than 1,000 jobs.

The company said it remains in negotiations with key creditors about a deal that would give it breathing space on the repayment of its debt

Deutsche Telekom have made no secret that they are interested in offloading their UK mobile phone unit T-Mobile UK, and have begun talks with the UK’s Vodafone, France Telecom, and Telefónica of Spain in hope of completing a rapid sale. One of the possibilities being discussed is a possible merger between T-Mobile UK and France Telecom’s Orange UK, a possibility suggested by Telecom. Representatives of Deutsche Telekom are seemingly hopeful that significant progress can be made by mid to late-October.

Electrical goods retailer DSG International were so anxious to withdraw from the Polish market that they sold off their interest there for a nominal €1, just three months after retreating from Hungary leaving a single Euro note there also. DSG have enjoyed considerably more success in the Nordic region however that is partially offsetting a continued weak performance in the UK and Ireland, where DSG operations Curries, PC World and Dixons electric goods retailing chains. Shares in DSG rose by 0.59 pence to 27.58 pence on the news.

Gains on London equity markets faded by the close on Thursday as falling oil and drug stocks offset gains for miners and financial stocks.

The FTSE 100 index ended a further 20.80 points lower at 4,796.75. Meanwhile the FTSE 250 made up for most of Wednesday’s reverses, rising 84.87 points to close on 8,604.80

The pound climbed to its highest level for a week on Thursday after a survey of the UK services sector raised some hopes that the country’s economy could return to growth in the third quarter.

• Pound/US dollar 1.6322
• Pound/Euro 1.1454
• Pound/Japanese Yen 151.1341
• Pound/Swiss Franc 1.7338

On Wall Street, the markets continued to be relatively stable, with the Dow Jones Industrial Average rising 11.86 points to close on 9292.53 while the NASDAQ Composite index rose a mere 5.94 points to close on 1973.01

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Tags: Alastair Darling, Banking, British Economy, British Pound, Cattles, Curries, Deutsche Telekom, Dixons, DSG, Economy, Employment, Financial News, financial recovery, France Telecom, FTSE, Global Economy, Gordon Brown, Money Markets, NASDAQ, OECD, Organisation for Economic Co-operation and Development, PC World, Recession, T-Mobile UK, Telefónica, UK Banks, UK Economy, UK government, UK Recession, UK treasury, Unemployment, Vodafone, Wall Street