Dollar higher on Chinese banking action

THE Australian dollar is almost half a US cent higher on liquidity action from China's central bank, and ahead of crucial economic news from Spain. 
 
At 12 noon (AEST), the Australian dollar was trading at 103.96 US cents, up from 103.51 cents yesterday.
The local currency fell as low as 103.29 US cents overnight, as the market grew increasingly concerned about the eurozone debt crisis, in the wake of higher bond yields in Spain and rioting in Greece.
Meanwhile, Australian bond futures prices were higher at noon.
The December 10-year bond futures contract was trading at 97.065 (implying a yield of 2.935 per cent), up from 97.035 (2.965 per cent) yesterday.
The December three-year bond futures contract was at 97.640 (2.360 per cent), up from 97.610 (2.390 per cent)

Read more: http://www.news.com.au/business/australian-dollar/a-slightly-higher-despite-euro-troubles/story-fn6t6wad-1226482287009#ixzz27eIkv3JA

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Vodafone has lowest customer satisfaction of all telcos, study reveals

VODAFONE customers just can't get no satisfaction.
The telco took out the top prize for the telco with the lowest customer satisfaction rating in a mobile lifestyle study released this morning.
Less than 50 per cent of Vodafone customers were satisfied with their provider, according to a study released by the Australian Interactive Media Industry Association.
The Australian Mobile Phone Lifestyle Index is an independent study conducted annually by the AIMIA.
Fifty-four per cent of Vodafone customers were not satisfied with the provider, which has been plagued by network issues over the last few years.
That figure represents a 42 per cent drop in customer satisfaction over the past two years.
Vodafone rated an 88 per cent satisfaction rate in the 2010 study and a 61 per cent satisfaction rate in 2011.
The drop in customer satisfaction, therefore, is significant.
The poor customer satisfaction rates follow almost two years of technical problems which caused prolonged network blackouts both for phone calls, text messages and internet access.
The problems were so bad it prompted the company's CEO, Nigel Dews to issue an apology to disappointed customers on Vodafone's blog in December of 2010.
The network problems followed a merger with the 3 Mobile network in 2009.
Dr Marisa Maio Mackay, Director of Complete the Picture Consulting and official research partner for the 2012 report told News Limited that the poor result for Vodafone "really reflected what had been happening in the market".
"It gains momentum," Dr Mackay said. "That probably is influencing the study result because of the significant drop in coverage for some users."
Dr Mackay said the merge with the 3 company and network drop-outs probably didn't help.
Virgin Mobile Australia took out the top satisfaction ratings when it came to smartphone choice, recording an 80 per cent satisfaction rate.
A spokesperson for Vodafone acknowledged that it had let its customers down."
"We know what it takes to be a market leader, and we know we’ve let our customers down," the spokesperson said.
"We are rolling out a range of initiatives to deliver a fantastic customer experience, teamed with our ongoing network improvement program and roll-out of 4G next year, we are confident we will lead the market again in customer experience."
Optus took out second place recording a 67 per cent satisfaction rate.

Read more: http://www.news.com.au/business/companies/vodafone-has-lowest-customer-satisfaction-of-all-telcos-study-reveals/story-fnda1bsz-1226482324963#ixzz27eIIl0oq

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Job vacancies rise 4.2% in August

The number of job vacancies in Australia has risen by 4.2 per cent, ABS statistics show.

THE number of job vacancies in Australia has risen by 4.2 per cent, official statistics show.
The total number of vacancies in August 2012 was 179,300, in seasonally-adjusted terms, compared with 172,100 in May, according to the latest Australian Bureau of Statistics (ABS) quarterly survey released on Thursday.
There were 165,900 private sector job vacancies in August, up 5.9 per cent on May's 156,700.
But the number of public sector vacancies in August, at 13,500, was down 12.9 per cent on August.

Read more: http://www.news.com.au/business/worklife/job-vacancies-rise-42-in-august/story-e6frfm9r-1226482585958#ixzz27e4JdTKh

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European Stocks Rally on Fed Enthusiasm

• 
  Reuters

The Federal Reserve's new plan to stimulate the U.S. economy and progress on tackling the euro zone crisis spurred a strong rally in risk assets on Friday, pushing global stocks to a 13-month high and sending Spanish and Italian bond yields lower.

European equities surged to a 14-month high with London's FTSE, Paris's CAC-40 and Frankfurt's DAX all well up, helping to lift the MSCI index of global stocks to 338.63, its highest level since August last year.

On the bond market, yields on 10-year Italian government bonds fell below five percent for the first time since late March as the Fed's announcement on Thursday compounded the recent improvement in sentiment towards riskier assets.

The Fed's decision to pump $40 billion into the economy each month until the weak U.S. jobs market turns up bolstered the positive mood which has dominated markets since the European Central Bank announced its own plan to cut borrowing costs of struggling euro zone members.

"There is a risk-on mood across the board at the moment, that (has to do with) the Fed but certainly it still echoes from the ECB," Rainer Guntermann, strategist at Commerzbank said.

Euro zone finance ministers were also meeting in Cyprus, hoping to build on progress the bloc has made this month, following the plans announced by ECB President Mario Draghi and a German court's green light this week for the euro zone's new ESM bailout fund.

Spain was being pressed to clarify whether it will seek the financial support which would clear the way for the ECB to buy its bonds. Questions remain whether Madrid could be tempted by the recent drop in its borrowing costs to tough it out without a politically unpopular EU bailout programme.

"I'd like them to set out their position because it hasn't been clear over the summer what their position is," Irish Finance Minister Michael Noonan told reporters, reflecting concern among several euro zone countries that uncertainty over Spain is holding back a recovery from the bloc's debt crisis.

DOLLAR WEAKNESS

On Wall Street, the Standard & Poor's 500 Index had its highest close on Thursday since December 2007 after the Fed's announcement of new bond purchases.

The dollar index measured against a basket of currencies fell to its lowest in over four months at 78.949. The Fed's quantitative easing plan equates to printing money and diluting the value of the currency.

The dollar's broad decline left the euro at a four-month high above $1.30, the latest in a string of technical and psychological levels it has cut through this week.

"With Europe getting their act together (at least temporarily), the Fed flooding the market with cash, and China talking (about) stimulatory infrastructure projects, the three largest influences of market dynamics could be creating a bull market for at least the near term," Neal Gilbert, currency strategist at GFT Forex.

Shanghai commodities futures, from copper to zinc jumped between 3 and 5 percent on hopes the Fed's move would bolster global demand for manufacturing and building materials. Oil moved towards $117 a barrel.

Gold rose to a 6-1/2-month high of $1,777.51 an ounce, leaving in on course for is fourth week of consecutive rises and on top of Thursday's 2 percent gain.

Stimulus measures like those announced by the Fed and ECB tend to give a twin boost for precious metals as they can benefit both from better global demand and their reputation as protection against inflation.

ITALIAN APPETITE

Demand for German government bonds and U.S. treasuries, typically favoured by investors seeking lower risk, extended recent falls.

Ten-year Italian yields fell below 5 percent for the first time since March 26 and were down 6 basis points on the day at 4.97 percent. Equivalent Spanish yields shed 3.5 bps to 5.64 percent.

"Five percent (Italian yield) is certainly eye-catching but the key level from a technical point of view is 4.7 so we still have to be cautious here," said Piet Lammens at KBC in Brussels.

"If it drops below that level I would interpret it as the market basically seeing Draghi's move as a game changer," he said, adding it was also important to see how aggressively the ECB used its new bond buying "bazooka".

Analysts are now wondering whether the positive momentum can be sustained. "In the next weeks or months it is not so easy to see what is going to drive the markets up further," said Heinz-Gerd Sonnenschein at Postbank in Frankfurt.

"The ECB and the Fed have given market participants what they wanted, we have had the positive German court ruling on the ESM so now the fundamentals will be back in focus."

Read more: http://www.foxbusiness.com/markets/2012/09/14/european-stocks-rally-on-fed-enthusiasm/#ixzz26S1aOEy5

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Fueled by Higher Gas Prices, Consumer Inflation Rises

• 
  REUTERS

Consumer prices rose in August by the most in three years as the cost of gasoline jumped, but there was little sign of a pick-up in underlying inflation pressures, which should allow the Federal Reserve to stay on its ultra-easy policy path.

The Consumer Price Index increased 0.6 percent last month after being flat in July, the Labor Department said on Friday. That was the first increase in five months and was slightly above economist's expectations for a 0.5 percent rise.

Gasoline prices, which recorded their largest increase since June 2009, accounted for about 80 percent of the rise in consumer inflation last month.

However, underlying inflation was fairly muted. The core CPI, which excludes food and energy prices, increased 0.1 percent for a second month in a row.

In the 12 months to August overall consumer prices increased 1.7 percent, staying below the Fed's 2 percent target, but advancing from July's 1.4 percent rise.

The U.S. central bank on Thursday launched a third round of bond purchases and extended its pledge to hold interest rates near zero to at least through mid-2015 from late 2014, in an effort to tackle stubbornly high unemployment.

Federal Reserve Chairman Ben Bernanke said he believed inflation would remain close to the Fed's target, noting that longer-term inflation expectations were quite stable.

Last month, overall inflation was boosted by a 9.0 percent surge in gasoline prices after a 0.3 percent rise in July. Gasoline prices at the pump increased 28 cents in August and could squeeze household budgets.

Food prices rose 0.2 percent last month after edging up 0.1 percent the prior month. Prices are expected to rise significantly later this year as the impact of a severe drought, which has caused a spike in corn and soybean prices, works its way through to the supermarket.

Away from gasoline and food, the cost of apparel declined 0.5 percent, breaking five months of gains. New motor vehicle prices gained 0.2 percent after falling 0.1 percent in July.

Prices for used cars and trucks fell 0.9 percent after dropping 0.5 percent the previous month. Housing costs edged up, with owners' equivalent rent rising 0.3 percent, the largest rise since November 2008.

In the 12 months to August, core CPI increased 1.9 percent, the smallest rise since July last year, after advancing 2.1 percent in July.

Read more: http://www.foxbusiness.com/markets/2012/09/14/consumer-inflation-rises-fueled-by-higher-gas-prices/#ixzz26S0uhunp

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Report: US Health System Wastes $750B A Year

WASHINGTON -- The U.S. health care system squanders $750 billion a year _ roughly 30 cents of every medical dollar _ through unneeded care, byzantine paperwork, fraud and other waste, the influential Institute of Medicine said Thursday in a report that ties directly into the presidential campaign.

President Barack Obama and Republican Mitt Romney are accusing each other of trying to slash Medicare and put seniors at risk. But the counter-intuitive finding from the report is that deep cuts are possible without rationing, and a leaner system may even produce better quality.

"Health care in America presents a fundamental paradox," said the report from an 18-member panel of prominent experts, including doctors, business people, and public officials. "The past 50 years have seen an explosion in biomedical knowledge, dramatic innovation in therapies and surgical procedures, and management of conditions that previously were fatal ...

"Yet, American health care is falling short on basic dimensions of quality, outcomes, costs and equity," the report concluded.

If banking worked like health care, ATM transactions would take days, the report said. If home building were like health care, carpenters, electricians and plumbers would work from different blueprints and hardly talk to each other. If shopping were like health care, prices would not be posted and could vary widely within the same store, depending on who was paying.

If airline travel were like health care, individual pilots would be free to design their own preflight safety checks _ or not perform one at all.

How much is $750 billion? The one-year estimate of health care waste is equal to more than ten years of Medicare cuts in Obama's health care law. It's more than the Pentagon budget. It's more than enough to care for the uninsured.

Getting health care costs better controlled is one of the keys to reducing the deficit, the biggest domestic challenge facing the next president. The report did not lay out a policy prescription for Medicare and Medicaid but suggested there's plenty of room for lawmakers to find a path.

Both Obama and Romney agree there has to be a limit to Medicare spending, but they differ on how to get that done. Obama would rely on a powerful board to cut payments to service providers, while gradually changing how hospitals and doctors are paid to reward results instead of volume. Romney would limit the amount of money future retirees can get from the government for medical insurance, relying on the private market to find an efficient solution. Each accuses of the other of jeopardizing the well-being of seniors.

But panel members urged a frank discussion with the public about the value Americans are getting for their health care dollars. As a model, they cited "Choosing Wisely," a campaign launched earlier this year by nine medical societies to challenge the widespread perception that more care is better.
resource:http://insurancenewsnet.com/article.aspx?id=356557&type=breakingnews#.UE87Y_Jic8o

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43 States Take Part In $10M Allianz Settlement

Iowa Insurance Division - September 6, 2012-The Iowa Insurance Division announced that a multi-state settlement agreement has been reached between Allianz Life Insurance Company (Allianz) and 43 States. Iowa acted as the managing lead state in the settlement and was assisted by three other lead states: Minnesota, Missouri and Florida. An additional thirty-nine states have now signed on to the agreement. The agreement establishes corrective actions, a remediation plan and levies a ten million dollar penalty to be distributed among the participating states.

The settlement was a result of a review of company practices related to the sale of fixed annuities by Allianz between the years of 2001 and 2008. Regulators reviewed how Allianz and its insurance producers sold its products, how the products worked and how the products performed. This multi-state settlement is limited to fixed annuities issued from 2001 through 2008.

A corrective action plan will require the company to change the format of its policy annual reports, maintain current company training and monitoring of its agents, change some aspects of its complaint handling, and require conformity with some of the monitoring provisions of the National Association of Insurance Commissioner (NAIC) Replacement Model. The company is required to submit reports to the lead states to confirm its compliance with the agreement.

Allianz is also required to implement a remediation plan to review complaints previously filed by its customers who purchased a fixed annuity between 2001 and 2008. Under the plan, prior complaints will be evaluated according to the standards listed in the settlement. If a complaint is found to be justified, the consumer will be offered retroactive cancellation of their policy, with a full refund of premiums.

Allianz will also accept new complaints from policyholders who purchased a fixed annuity between 2001 and 2008 and who have not yet submitted a complaint. The deadline for new complaints to be filed with the company is March 31, 2013.

The amount of the fine to be received by each of the participating states will vary based on the final number of the states who sign the agreement and the number of affected policies in each participating state. Iowa’s share is expected to be approximately $150,000.

“We’re very pleased to have reached this settlement,” said Iowa’s Insurance Commissioner Susan Voss. “This is a great example of several states jointly and collaboratively taking action to review a company. It will benefit the participating states; allow current customers an opportunity for a review of their individual cases and assure that the practices of the company are or will be in line with the standards established by state regulators.”

Iowans who purchased a fixed annuity from Allianz between 2001 and 2008 who have questions about this settlement or the process of filing a complaint can contact the Iowa Insurance Division at 877-955-1212.

Resource:http://insurancenewsnet.com/article.aspx?id=356565&type=breakingnews#.UE86kPJic8o

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President Tells Tale of Two NAIFAs

LAS VEGAS, September 9, 2012 -The president of NAIFA in his address to the annual conference decried an unhealthy level of distrust and division within the association and called for unity in the face of one of the most challenging times for life insurance and financial advisors.

Robert A. Miller, the 2011-2012 leader of the National Association of Insurance and Financial Advisors, said the animosity is damaging the very base of the federated organization of more than 600 state and local groups comprising 45,000 members.

“We see states vying with locals; locals that are having trouble filling their board positions and suspicious of any unsolicited advice,” Miller said this morning at the Las Vegas annual meeting, according to an advance copy of his speech. “The closing down of under-performing locals has reached epidemic levels, while states unable to afford professional management are on the rise. Some states and locals seem to gather hurricane force energy in stating their enmity toward NAIFA-national.”

Miller put NAIFA’s division in the context of the national schism with deep discord between political parties. But he said that unlike the Democrats and Republicans, NAIFA members should belong to one party in particular.

“No matter what party anyone in this room belongs to, the one party whose bandwagon you better get on is the insurance party,” Miller said, adding an ominous note. “We are one signature from extinction.”

For historical perspective of NAIFA’s impact on public policy, Miller reached back to the group’s early history, when it was the National Association of Life Underwriters (NALU) and advocating for the insurance industry even before World War I. That was 1913, when NALU helped the Woodrow Wilson administration establish the tax benefits on which the industry now depends.

A hundred years later, NAIFA has to continue that struggle.

“In an ironic twist of historical symmetry, in 2013 NAIFA will be fighting to protect our products from a polemically charged Washington looking to pay down its debt,” Miller said. “The tax advantages that insurance products have enjoyed because of their unique nature are at risk. This threat is serious.”

But Miller also sounded hopeful notes as he described the enthusiasm he saw in many members he met in his year traveling for the association.

“As your president, I had the opportunity to experience the best of what NAIFA is all about,” said Miller, who is also a partner at Miller-Pomerantz and Associates in New York City. “I traveled across the country, meeting with members and state and local leaders. Some were experienced veterans of the business; others were young and promising agents. Many inspired me with their energy and enthusiasm.”
resource : http://insurancenewsnet.com/article.aspx?id=356790&type=topnews

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ECB Holds Rates, Draghi Conference in Focus

• 
  Reuters

European Central Bank chief Mario Draghi faces the most decisive moment of his presidency on Thursday when he aims to back up his vow to save the euro with a bond-buying plan - the main focus of a policy meeting where it kept interest rates on hold.

Investors want to hear how the ECB will start the new bond-buying programme to help bring down the borrowing costs of Spain and Italy, after disagreements between bank policymakers over the plan were played out in public last week.

With the bond-buying plan the focus of Thursday's meeting, the ECB Governing Council kept interest rates on hold, leaving its main rate unchanged at 0.75 percent.

"A rate cut would have been understandable given the weak economic data, but clearly the ECB wants to address the main risk first, the convertibility risk, which the ECB will try to attack with a new bond purchase programme, if governments play along," said Stefan Schilbe, chief economist at HSBC Trinkaus.

The euro rose after the rate decision and German benchmark bond prices fell.

Pressure on Draghi intensified after an unsubstantiated German newspaper report that Bundesbank chief Jens Weidmann had considered resigning over his opposition to bond-buying, although several sources say he has made no such threat and believes in staying at the table to argue his case.

Renewed ECB intervention in the euro zone's bond markets is crucial for buying governments time to come up with a longer-term response to the bloc's debt crisis.

Investors are looking for Draghi to flesh out enough details of the plan to back up his promise on July 26 to do "whatever it takes" to preserve the euro when he speaks after the Governing Council meets.

"Expectations are extremely high. If the ECB does not deliver, we will get into another bad patch," said Gilles Moec, senior European economist at Deutsche Bank.

Spanish and Italian government bond yields have fallen significantly since Draghi said on Aug. 2 that the ECB would buy bonds issued by Madrid and Rome.

ECB debt purchases - which would succeed the bank's Securities Markets Programme that has been dormant since March - would only resume under strict conditions and if countries first sought help from the euro zone rescue fund.

Markets have been expecting Draghi to unveil a bold plan after Thursday's policy meeting.

But while he is likely to deliver a framework for new bond purchases, he will give no details of planned amounts or explicit targets for yield spreads or levels of interest rates, two central bank sources told Reuters.

"A number of investors expect that the button will be pushed without further ado, but it is a bit more complicated than that," Deutsche Bank's Moec said.

SECURING MAJORITY SUPPORT

Securing majority support on the Governing Council for a plan that Weidmann can live with represents the trickiest balancing act Draghi has faced since he took over the ECB presidency on Nov. 1 last year.

Weidmann has expressed concern that intervening in the bond market to reduce the borrowing costs of struggling euro zone countries such as Spain and Italy - which had reached levels that were unaffordable in anything but the short term - would break the ECB taboo of financing euro zone member states.

Other ECB policymakers see a greater urgency to help Spain and Italy to prevent the euro zone crisis from deepening.

One of the sources said the ECB is keen to attach strict conditions to its new programme. These will be enforced by the International Monetary Fund - which has a reputation for being tougher than European Union institutions - to keep up the pressure for reform.

The Governing Council would decide on a case-by-case basis and keep close tabs on the programme, one source said, while the other source ruled out a shock-and-awe approach, in which the ECB would start off by buying huge amounts to impress markets.

The ECB was prepared to waive its senior creditor status on bonds it purchased - meaning it would be treated equally with private creditors in case of default.

"There is a problem if central banks insist on the preferred creditor status, because the more the public sector intervenes in the bond market, the less interest private investors will have," said one of the sources, who has seen preparatory documents for the Council meeting.

PRINCIPLES VS FLEXIBILITY

The terms of ECB intervention, which Draghi is expected to lay out when he reports the Council's decisions at a 1230 GMT news conference, will determine whether Spain seeks help.

Prime Minister Mariano Rajoy said on Sunday that Spain, the euro zone's fourth largest economy, would consider seeking extra aid on top of an up to 100 billion euro rescue of its banks, but he wanted to see details of the ECB's programme before deciding.

Asked about ECB bond buying and a conflict of interest between Spain and Germany, Rajoy told Germany's Frankfurter Allgemeine Zeitung: "I understand Germany's concerns and know Germany's economic history ... the risk premium and difference in interest rates are rendering our efforts worthless."

"It is good to have principles in life. But sometimes it is also good to be flexible," he added.

Spain is in recession and a quarter of its workers are out of a job, meaning tax revenue is falling and this is undermining the government's austerity drive.

The Council is expected to broaden the list of securities banks can pledge as collateral at the ECB in return for cash, something that will be particularly important for Spain's ailing banking sector.

Read more: http://www.foxbusiness.com/markets/2012/09/06/ecb-holds-rates-draghi-conference-in-focus/#ixzz25gyskuFL

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UK rises in WEF competitiveness rankings survey

A relatively flexible labour market has helped the UK economy, the WEF says

The UK has risen to eighth from 10th place in an annual study of global competitiveness.

The World Economic Forum's (WEF) survey said the UK had benefited from a more efficient labour market compared with more "rigid" European economies.

The US economy fell from fifth to seventh place, although WEF said it remained the top innovator.

Switzerland topped the table, followed by Singapore and then Finland in the survey of 144 economies.

The ratings are compiled using public data as well as executive opinion.

The survey placed China as the most competitive major emerging economy.

'Innovative businesses'

The WEF said the UK had benefited from "clear strengths such as the efficiency of its labour market" and praised the UK's "sophisticated and innovative businesses".

Global top 10 (previous year in brackets)

1: Switzerland (1)

2: Singapore (3)

3: Finland (4)

4: Sweden (3)

5: Netherlands (7)

6: Germany (6)

7: United States (5)

8: UK (10)

9: Hong Kong (11)

10: Japan (9)

Source: World Economic Forum

However, the body said the country's macroeconomic economic environment - ranked 110th, down from 85th last year - was hindering competitiveness.

The Treasury said it "welcomed" the report, saying the UK's improvement was down to the government's reforms.

The report uses 12 categories to assess a country's ranking: institutions, infrastructure, macroeconomic environment, health and primary education, higher education and training, goods market efficiency, labour market efficiency, financial market development, technological readiness, market size, business sophistication and innovation.

The WEF report comes a day after a separate survey indicated activity in the UK service sector had picked up in August on the back of new contracts, increased marketing and, to a lesser extent, better weather.

Europe's north-south divide

The WEF survey showed a clear divide between Europe's northern countries and the troubled periphery economies which are suffering from recessions.

In total, six European economies are in the top 10 - Switzerland (1st), Finland (3rd), Sweden (4th), the Netherlands (5th), Germany (6th) and the United Kingdom (8th).

But the southern eurozone economies are ranked much lower, with Spain in 36th place, Italy 42nd, Portugal 49th and Greece 96th.

The southern economies, which are at the heart of the eurozone sovereign debt crisis, have suffered a chronic lack of competitiveness and low levels of productivity that led to unsustainable imbalances in the economy, followed by rising unemployment.

The WEF urged an overhaul of labour regulations "sooner than later" as one of the necessary reforms to restore growth.

Switzerland maintained its top position thanks to its scientific institutions, a strong collaboration between academia and business sectors, high spending on research and development as well as its high rate of patenting per capita, the WEF said.

US political gridlock

The US ranking has continued to fall due to weakness in the overall economy as well as worries among businesses towards what they perceive as government meddling in the private sector and distrust towards politicians.

The WEF warned that in the US, despite being the world's top innovator with the likes of Google and Facebook, political gridlock over fiscal tightening could dampen growth prospects.

The survey cited an inefficient government bureaucracy and tax rates as the two biggest impediments to doing business in the US.

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Share this page * Facebook * Twitter * Email * Print Share this page Lenovo shares slide as NEC sells its stake in the firm

Lenovo has been working with NEC to boost its market share in Japan

Shares of Chinese PC maker Lenovo have dipped in Hong Kong after Japan's NEC sold its entire stake in the firm.

The Japanese firm sold nearly 281 million shares of Lenovo in a deal estimated to be worth HK$1.86bn ($240m; £151m).

NEC had acquired these shares in exchange for a 51% stake in a joint-venture the two companies had announced last year.

Lenovo shares fell as much as 8% to HK$6.08.

However, Lenovo said that the sale will not affect the venture which the two firms announced last year to manufacture PCs in Japan in a bid to increase their market share in the country.

As part of the deal, NEC was allocated the said Lenovo shares, worth about $175m at that time. It was agreed that NEC will not be allowed to sell or transfer the shares for a period of two years beginning 1 July 2011.

However, the Japanese firm had requested Lenovo to grant it permission to offload the stake.

In a statement to the Hong Kong Stock Exchange on Tuesday, Lenovo said that keeping in view "the business relationship and ongoing cooperation" between the two firms and "the financing needs of NEC", it had agreed to the request.

"In reality, NEC could sell those shares after two years anyway as per contract" said Roderick Lappin, vice president of Lenovo Group and executive chairman of the joint venture Lenovo NEC Holdings.

"All we have done is to let them do it 10 months earlier."

resource:http://www.bbc.co.uk/news/business-19485410

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Longer working week suggested for Greece

There have been many demonstrations against the austerity measures agreed so far

Greece's international lenders have suggested measures including increasing the maximum working week to six days.

It is one of several unofficial proposals to liberalise the labour market and increase government revenue, contained in a paper seen by the BBC.

The proposals were not included in the original bailout agreement signed with the Greek government.

Inspectors from the EU, IMF and European Central Bank, known as the troika, are due in Greece this week.

They are writing a report, due in October, that will decide whether Greece receives its next instalment of bailout funds.

Greece needs the next payment of 31.5bn euros ($39.6bn; £24.9bn) to allow it to continue servicing its debts.

Proposals in the document from the troika included:

• Setting a single rate statutory minimum wage
• Reducing regulatory burdens
• Making work schedules more flexible
• Setting a minimum daily rest of 11 hours
• Eliminating restrictions on the minimum and maximum time between morning and afternoon shifts.

Also, on Wednesday, German Finance Minister Wolfgang Schaeuble ruled out a third package of aid for Greece, but stressed that it would be staying in the eurozone.

"The costs for Greece are already very high and therefore we cannot have a new programme for Greece," he told German radio.

Greece was given a 110bn-euro package in May 2010 and a further 130bn euros in October 2011, along with a 100bn-euro debt write-off.

European President Herman Van Rompuy is due to meet Greek leader Antonis Samaras on Thursday.

Euro bailout

The International Monetary Fund (IMF), the European Central Bank (ECB) and the European Commission - the group of donor bodies known collectively as the "troika" - are examining whether Greece is making sufficient progress towards reforming its public finances.

Greece is currently trying to finalise a package of 11.5bn euros ($14.4bn; £9.1bn) of spending cuts over the next two years.

It is also being asked to put in place economic and structural reforms, including changes to the labour market and a renewed privatisation drive.

The measures are needed to qualify for the next 33.5bn-euro instalment of its second 130bn-euro bailout.

Greece needs the funds to make repayments on its debt burden. A default could result in the country leaving the euro.

Resource:http://www.bbc.co.uk/news/business-19491266

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Drought putting a drain on Midwest economy

A monthly survey suggests that the continuing drought and lessening export demand for U.S. products are among the drains on the economy in nine Midwest and Plains states.

A report released Tuesday says August's Mid-America Business Conditions Index remained below growth neutral for a second month. It rose to 49.7 from 48.7 in July. June's figure was 57.2.

The survey of business leaders and supply managers uses a collection of indexes ranging from zero to 100. Any score above 50 suggests growth while a score below 50 suggests decline for that factor.

Creighton University economist Ernie Goss oversees the survey, and he says supply managers remain pessimistic about future economic conditions.

The survey covers Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota.

Read more: http://www.foxnews.com/us/2012/09/04/drought-putting-drain-on-midwest-economy/?test=latestnews#ixzz25VRxt2ai

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