European shares fell sharply Monday in volume again, failure of U.S. lawmakers to agree on reducing the federal deficit and a warning from Moody's about the "triple A" of France with weighed on investor sentiment.
In Paris the CAC 40 yielded 3.41% at 2894.94 points.
All eyes are on Berlin where German parliamentarians must vote on a proposed reform of the European Financial Stability Fund (EFSF) earlier this afternoon after a speech by Angela Merkel.The Chancellor will then travel to Brussels for EU summits and the euro area, which should provide practical solutions to the debt crisis.
At 9:30, the CAC 40 lost 0.35% to 3163 points while the Eurofirst 300 was almost stable.
European markets are down, investors holding their breath awaiting the outcome of the day announced as crucial for the future of the euro area.
"It is expected that the Bundestag decides on reinforcements EFSF and the role of the ECB in managing the crisis," said a trader based in Paris.
Values, PSA fell sharply under the influence of lowering its forecast for 2011 after a third quarter marked by lower volumes and increased competition on prices in Europe.The group is likely to reduce its workforce by 10% in Europe.
Ingenico, in contrast, was part up 5% in early trade Wednesday of the Paris Bourse, the manufacturer of payment terminals has published the day before its sales for the third quarter.
The euro remains firm and resolutely clings to a level above $ 1.39, while the German Bunds are hesitant, waiting for a clearer trend in equity markets.
Spot gold rose 1% touching a high of more than a month, reflecting investor fears that the crisis drags on still.
Olympus still has the title fell 6.81% Friday, the market value of the Japanese and melted with about 50% since last Friday, the day he announced the dismissal of its chief executive Michael Woodford.
Investors have pushed the action and the manufacturer of cameras and optical instruments of precision to a low of two and a half years, adding to even more pressure on the group to be explained on unusually high consulting fees paid in connection with an acquisition and revealed by the ousted leader.
Olympus acknowledged Wednesday it had paid $ 687 million (498 million) in financial advisors in the purchase of the British manufacturer of medical equipment Gyrus.
These fees represent a third of the price of the acquisition, whereas traditionally they account for only 1% or 2% of the value of a transaction, according to a PriceWaterhouseCoopers study commissioned by Michael Woodford.
POLICE PROTECTION
The latter told Reuters on Thursday it had filed for protection under the British police after submitting new information to investigators British anti-fraud regarding fees.
In the data transmitted to the authorities by Michael Woodford, a former investment banker from Japan appears to be the central figure in the matter of fees.
According to these documents, Hajime "Jim" Sagawa was the owner of AXIS, a financial services company little known American who received the exorbitant fees reported by Michael Woodford.
Olympus, which denies any impropriety, said the fees had been paid to its subsidiary AXIS Axam Investments, a company registered in the Cayman Islands, including Hajime Sagawa was a member of the Board, the report of PricewaterhouseCoopers.
Reuters visited the home of the latter, a former Nomura banker, only to find that his wife, who assured that her husband had done nothing wrong.
INVESTIGATION OF SESC JAPAN
Michael Woodford has also written to the Securities and Exchange Surveillance Commission (SESC), the authority of the Japanese financial markets, asking him to consider the case Olympus.
An investigation by the SESC could take months. Financial Services Minister Shozaburo Jim said the policeman of the financial sector would work, but refused to comment on individual cases.
"Olympus has clearly withheld information to investors. And even if she is not guilty of actions contrary to law, management has breached its obligations vis-à-vis shareholders.It should take responsibility, "said Shigeo Sugawara, manager of Sompo Japan Nipponkoa investments in Asset Management.
Olympus may have to spend significant impairment likely to weaken its balance sheet. And even if, according to manager, many candidates would be interested in the instruments of precision optics group, no one would touch it before the case is improper fees paid.
The company is now worth some $ 4.5 billion.
Brokers have suspended their coverage of Olympus as key shareholders and require that the group be made public links between management and its financial advisors.
It would be more optimistic. But this week, what looked like vile premonitions markets began to be realized. Back to the bad news that destabilized the stock markets. A trader at the New York Stock Exchange, September 22, 2011. The Fed and the IMF say they fear a recession
If grants are all black is that they painted a very grim future. The IMF had laid the groundwork earlier this week by revising down its forecast strong global growth, and considering the "worst case scenario", a recession in major developed countries that would eventually weigh on emerging markets.While the IMF does not make his case a priority – rather table it is growing very soft, the risk has become more consistency Wednesday with what the Fed's emphasis on "continuing weakness" of the labor market United States and the "significant risks" associated with "pressure on global financial markets." This pessimism was immediately stunned the markets. And the more they learned that private sector activity in the euro area was recorded in September, its first decline in two years. And that manufacturing activity had declined in China. If even the Middle Kingdom began to fail …
The failure of Greece is similar
Athens is back to the wall. For the loan of 8 billion euros of its creditors and avoid failure in October, Greece has agreed to a new "social massacre" which includes a tax on income from 416 euros per month.Moreover, the second aid plan in advance of July 21 at idle. Europe seems unable to speed up, as shown by the peak in Poland last weekend. And despite the talk of intentions, the scenario of the failure seems inevitable. Greek media have raised the idea on Friday the government to cancel 50% of the debt. Which would lead to a loss of 25 billion euros for Greek banks, most of which have just been degraded by Moody's. The announcement was immediately denied by the government. Until when?
Standard & Poors downgraded the debt rating Italian
This is a first for the boot, Standard & Poor's downgraded the rating on Monday of the Italian debt. This decision did not sway the markets, which expected, but investors fear the domino effect.Growth prospects of the country are particularly likely to be sealed by the new austerity plan of 54.2 billion euros. In turn, Moody's announced that it would degrade Italy "in the coming months." Rome is not the only "lame duck" of Europe. Portugal, already qualified for a loan of 78 billion euros, is in trouble after the discovery of an undeclared debt 1, 68 billion euros. As for Slovenia, she saw the note be degraded by Moody's on Friday. Only Ireland, recovering, doing well with the announcement Thursday of a 1.6% growth in the second quarter. Rare enough to be highlighted …
Brussels acknowledges the need to recapitalize banks
After weeks of procrastination, public authorities have come to settle international: Some European banks will be recapitalized.After Christine Lagarde, who launched the attack late August, the EU has abdicated this week. The IMF, which recommends that banks can recapitalize directly from EFSF, it is estimated that 300 million bill from the Greek crisis for the banking sector. According to the British press, 16 banks have failed those tests fail to stress – be in the viewfinder of EBA (EBA). But the French, who are yet in the heart of stock market panic, would not be affected. Such as Germany and Spain, France is reluctant to inject new funds to banks on the pretext that they are not facing a crisis of solvency but liquidity. If, as apprehensive markets, Greece is lacking, and that Italy and Portugal a restructuring of their debt, they will not escape.
The United States deplored the European fiscal discipline
The more one goes into the crisis and is more visible: the states are powerless to solve the problems because they are unable to agree. For weeks, markets expect strong political positions. Instead, the summits are linked together without any serious decision is taken. Just this week, the Ministers of Finance of the euro area have found themselves in Poland, and Washington for the opening dinner of the G20 finance. But each time, markets would have found that the more anxious. In addition to the severe lack of European governance, the divisions seem more and stronger on one side and across the Atlantic. The United States to Europe including blaming his fiscal discipline, almost incompatible with the maintenance of growth. A conundrum that nobody wants to decide.Not even the IMF, very poor matchmaker. On Thursday, Christine Lagarde has merely conceded to each other, supporting Barack Obama's plan for employment (447 billion), and commending the efforts of countries involved in the decrease of budget deficit …
Operation Twist Fed is pschitt
The markets had placed too much hope in the meeting of the Fed's Sept. 20. They had been dreaming that her boss, Ben Bernanke, went out of his hat and decisive action to support the U.S. economy. Whereby they have had the formalization of the launch of Operation Twist. This is for the Fed to exchange $ 400 billion in Treasury bonds against short-term securities with longer maturities. The objective of this hocus-pocus giant is to influence the rate of long-term interest to encourage business investment and private individuals.Problem, it is an indirect incentive does not offer assurance of effectiveness. In addition, if the technique is clever, it reveals above all the lack of leeway for the Fed can not lower its rates or already virtually zero, or purchase of new Treasury bills. In other words, after the operation Twist, the U.S. central bank is disarmed. What is worrying the markets.
The Greek authorities have promised Sunday drastic measures to avoid non-payment of debt interest payments and get the next tranche of international aid, but have not announced anything new.
George Papandreou, head of government, gave up a visit to the United States to chair a cabinet meeting on the eve of a crucial deadline for the release of this new installment.
His finance minister Evangelos Venizelos will present Monday, as part of a teleconference, the plan of fiscal consolidation to inspectors of the European Union and the International Monetary Fund (IMF), which will decide whether to release the eight billion euros, of which Athens will be needed in October.
After the Council of Ministers, Evangelos Venizelos stressed the need for budgetary targets for 2011 and 2012, and the deficit next year.
"I want to avoid a default.To stabilize the situation, to remain in the euro area (…), we must make strategic decisions, "he said without further detail.
The government will meet again after his meeting with the inspectors to detail the measures adopted.
Fault of payment of that portion of eight billion euros, Greece is insolvent next month.
This week, the government blamed the widening deficit in a recession stronger than expected and decided to impose a new property tax which he expects around two billion euros per year.
The "troika" formed by the inspectors of the IMF, the EU and the European Central Bank (ECB) may, however, that this tax does not change the situation and really requires more information on how the government intends to do it to correct the public accounts.
"The troika believes that the recently announced property tax alone will not bridge the budget deficit and pushed for conservation measures, downsizing and wage in the public sector," said a senior Greek.
OPPOSITION wants to renegotiate
International donors are also concerned about the lack of political consensus on how to implement out of the crisis.The conservative New Democracy, spurred by a growing popular discontent after two years of austerity, propose them, measures to boost growth.
Their leader Antonis Samaras called Saturday for early elections, saying that the path followed so far produced no results despite the sacrifices required of the population.
"A renegotiation with our donors to stimulate the economy is a condition to get out of this crisis," he said Sunday at a news conference.
The Socialist Party of George Papandreou has a majority in parliament, but internal differences associated with radical protests against the austerity could lead to early elections, say some observers.
In an interview with Bild am Sonntag, the German Finance Minister Wolfgang Schäuble considers that Greece must have a clear mind about his future in the euro area.
"Belonging to a currency union is an opportunity but also a heavy burden. The measures to align its very difficult and the Greeks must decide whether to bear this burden," he said.
"No one should kid ourselves: without a positive assessment by the troika of the commitments of Greece, the next installment will be paid.So the Greeks must have numbers proving that they stick to the plan. "
His French counterpart Francois Baroin recalled his part that the plan of aid to Greece was a loan, not a gift, save for the euro.
"The observers are in place, they continue their work.Greece knows what she has to do it we have said, she has commitments, she has duties vis-à-vis its creditors, it has the requirement to provide answers. "
In the meantime, the Greek newspaper Kathimerini writes Athens plans to make the country's banks credit guarantees of up to about thirty billion to enable them to access the emergency stop of the central bank.
Excluded from the interbank market, Greek banks have become dependent on the ECB for their refinancing, borrowing in its operations in the money market, in exchange for guarantees in the form of sovereign bonds and other assets.
The Swiss National Bank (SNB), as expected, Thursday maintained its monetary policy at zero, but significantly lowered its estimates for growth and inflation.
The SNB lowered its growth forecast of gross domestic product (GDP) now expects an increase between 1.5 and 2% in 2011 instead of 2% "about".
It relies now on a 0.4% inflation in 2011 and a deflation of 0.3% for 2012 as it foresaw in June respectively rates of 0.9% and 1%. For 2013, the central bank refers to a price increase of 0.5% versus 1.7% previously.
The SNB justifies its decision by explaining that it expected GDP growth will stop in the second half.It recalls that in Switzerland, the development of the economy "is hampered both by the strength of the franc and the decline in foreign demand."
The SNB repeat it "will prevail over the floor of 1.20 francs per euro, fixed on September 6, with all the required determination." She intends to keep the total deposits on demand well above 200 billion francs.
"Without the stabilizing effects of the floor price, the risk of recession would be significant," she warns.
The central bank believes, however, that even at 1.20 franc per euro, the franc is at a high level."If the economic outlook and the risks of deflation required by the National Bank will take additional steps," she adds.
She noted that the downside risks could occur at price stability if the franc were to cease to weaken.
The SNB has kept its rate fluctuation corridor Libor in Swiss francs at three months from 0 to 0.25%, which was expected by 34 economists polled by Reuters.
After a week of trading the most volatile memory, the New York Stock Exchange finished up Friday, raising hopes that the worst is over regarding the massive sales of securities that have been observed day funds.
The rebound Friday has not helped to erase the losses of the week, and U.S. markets are on track to achieve their largest decline over three weeks since March 2009.
The Dow Jones gained 1.13% or 125.71 points to 11,269.02 points and the S & P 500 has been 0.53% or 6.17 points to 1178.81 points.
The Nasdaq was awarded for its 0.61% (15.30 points) to 2507.98 points.
For the week, the three indices yield respectively 1.5%, 1.7% and 1%.
Sign that investor anxiety has subsided somewhat, the volume of trade Friday was much lower than in the previous four sessions, and changes in the rating were less violent.
"The decline in volume today clearly indicates that the current market a little less worried," commented Ken Polcari of ICAP Equities prior to closing.
He said that if the economic indicators next week are in line with expectations, the trend may continue.
"Before you go higher, the market needs to repair itself a little and to rebuild a database.This is what happens now. "
The rise in European markets, due to the ban on short selling some financial stocks, has helped to support Wall Street.
The U.S. economic indicators have meanwhile been blowing winds in the markets.
The numbers of consumer sentiment have molested standing at their lowest since 1980 but the July retail sales showed their biggest increase in three months.
As for values, title Nvidia fell 3.95% to 12.88 dollars, offsetting the strong gains made last after the announcement that the group included a higher than expected its quarterly revenue.
S & P has taken a decision resounding Friday: leave the first world power of the inner circle of the most reliable borrowers. Now the United States are nothing more than "AA +". To reduce the deficit, U.S. President Barack Obama largely agrees to cut public spending, including social, but demand for part-against higher taxes for the wealthy.
The rating agency Standard and Poor's lowered the rating Friday on the public debt of the United States, deprived of their "AAA" for the first time in history, citing the "political risks" facing the challenges of the deficit budget. S & P said in a statement it had lowered the rating a notch, the best possible, to bring it to "AA +".It also downgraded the outlook to "negative", which means that Standard and Poor's believes that the next time the note will change, it is to be lowered again.
It justified its decision with "political risks" to see the country taking insufficient measures against its budget deficit. For her, the political debate on these issues is not up to the problems caused by a debt of more than 14,500 billion. "The plan for balancing the budget on which Congress and the Executive have recently agreed is insufficient compared to what, in our view, would be needed to stabilize the dynamics in the medium term public debt" , said the agency, citing the law known as "control the budget" passed Tuesday.
The United States were rated "AAA" by Standard and Poor's since the creation of this agency in 1941.They remain in the other two major agencies, Moody's Dean (since 1917) and Fitch Ratings. The U.S. government has accused S & P based its decision on serious errors in calculations. "An appraisal contains an error of 2.000 billion dollars speaks for itself," he told a press spokesman for the Treasury Department. U.S. media said the government had severely challenged the projections of analysts of the agency after reviewing the findings of S & P. In vain.
The pitch was not easy to be taken to a U.S. agency."They have downgraded a bunch of European countries, and Europeans were bent on rating agencies: why you lower your bill and not the U.S.?" Fell on the Bloomberg TV channel economist Nouriel Roubini, who became famous for his dark predictions.
The loss of this seal of excellence is expected brutal impact on the financial markets, difficult to imagine right now. The U.S. Treasury is an undisputed reference: a standard cost of money, usually an instrument of "collateral" (guarantee) in a variety of transactions, and a refuge for investors in troubled times. "Uncertainty about the impact on the market is high," said recently the investment bank Goldman Sachs, exploring the potential consequences.The lowering of this note should indeed force investors to reassess risk widespread.
Standard and Poor's warned in April that it was considering lowering, given the persistently high budget deficit and rising public debt. The unfolding conflict of budget debates in the coming months, which culminated Tuesday in extremis on raising the legal limit of public debt, had only compare this perspective. John Chambers, President of the Evaluation Committee of S & P, said Friday on CNN that Washington could have prevented the lowering of the notes within the ceiling earlier. He said the responsibilities were shared by the Administration and Obama, but also to "the previous administration."
The first political reaction in Washington have shown just block pointed to by S & P.Mitt Romney, candidate for the Republican primary, has called the downgrade of American "latest victim of the failure of Obama's economic" and the Republican chairman of the House of Representatives as "a consequence of control spending in Washington in recent decades. " The Senate Democratic leader, Harry Reid, has instead called for "a balanced approach to deficit reduction," with spending cuts but also increases targeted taxes, it rejected the Republicans, under pressure ultra-conservative "tea party", in the recent discussions on the dates.
The S & P announcement came as the markets had closed for the weekend, but initial reactions are mixed from Asia.The Japan, the second holder of U.S. debt world, assured that his confidence in the U.S. Treasury and its strategy of purchasing these bonds were unchanged. France "with complete confidence in the strength of the U.S. economy," said Saturday told AFP the Minister of Economy Baroin. But China, by far the largest creditor of the world the United States, found that it was "now all rights to require the United States they are addressing their structural problem of debt."
The United States had their public finances sealed by the harsh recession that crossed their economy from late 2007 to mid-2009. Since then, economic growth has returned, but they are not able to restore the health of their public finances.According to estimates by the International Monetary Fund, they should acknowledge this year, with about 9% of GDP, the highest budget deficit of the G20 countries, except Japan. It is sixteen countries rated "AAA" by Standard and Poor's, four of the G7: Germany, Canada, France and Great Britain.
The British government wants to know if the group of Rupert Murdoch, already forced to abandon its takeover offer full BSkyB, may remain a shareholder of TV channels in Britain, said Thursday the deputy prime minister Nick Clegg.
The News Corp. has already closed abruptly the British tabloid News of the World, he also abandoned, at least temporarily, to acquire 61% of the BSkyB satellite platform that does not yet, but it still will not turn off the fire caused by the revelations about the practices attributed to his newspapers in Britain.
The fire seems to even win the United States, where influential senators demanded an inquiry into News Corp., and Australia, native of Rupert Murdoch, where the government could reform the law on the media.
British police also questioned Thursday ninth suspect in the investigation, reopened in January, the illegal wiretapping charged to News of the World. According to media reports, it would be a former editor of the tabloid.
Faced with the uproar caused by revelations about the practices of the newspapers of Rupert Murdoch, also accused of corruption of police, News Corp. announced Wednesday that he would not fully acquire BSkyB.Meanwhile, British parliamentarians, in a rare union, proclaimed their opposition to this project.
CLEGG STANDS OUT OF CAMERON
Nick Clegg said Thursday that the UK's media regulator, Ofcom, had undertaken to examine whether News Corp., whose British arm News International is at the heart of the scandal, could be allowed to maintain its existing share 39% of BSkyB.
"It is clear that serious questions now exist about the ability of News International (to be involved in television) and this is exactly what Ofcom is currently considering," said Vice Prime Minister to the antenna of the BBC Radio 4.
"What is not clear enough to me, is how it is assessed," said the leader of the Liberal Democrats, partners in the conservative coalition.
News of the World is accused of hacking, with the help of private investigators, telephone messaging of thousands of people – the protagonists of news items, celebrities, relatives of soldiers killed in Afghanistan and even, perhaps of police officials – and bribing police to get scoops.
In Britain, the case has political implications because the Prime Minister David Cameron was hired as a spokesman for a former editor of News of the World, Andy Coulson, who has now resigned from the head of government .
Nick Clegg tried Thursday to distance itself from this decision.
"We discussed, of course.But ultimately, I choose my collaborators and David Cameron chooses his own, "he said.
British parliamentarians do not matter rest there with Rupert Murdoch, whose influence on the political class is now exposed, and they asked him, and his son James and Rebekah Brooks, the owner of News International, testify next Tuesday before their media commission.
OPEN DEBATE IN AUSTRALIA
The businessman, who has U.S. citizenship, they sent Thursday a plea of preventing that receive only answer questions from the public inquiry announced by David Cameron.
His son James, who should succeed him one day as head of News Corp, for his part said he could not appear before the parliamentary committee before August.
Rebekah Brooks, a friend of David Cameron and former editor of News of the World, has agreed to testify before parliament, preventing it may not be able to answer all their questions because of the investigation current font.
News Corp is also weakened the United States, where he has particular news channel Fox News and the Wall Street Journal, and Australia, where he owns about 150 newspapers and magazines, including major newspapers across the country such The Daily Telegraph of Sydney and the Herald Sun of Melbourne.
"See things like that, violations of privacy, particularly of people anxious and grief-stricken. All this makes me sick," said Australian Prime Minister, Julia Gillard, to the Australian Press Club.
"I guess we will discuss with parliamentarians in the best way to deal with all this," she said.
United States, three influential senators have asked the Department of Justice and the market regulator, the SEC opened an investigation into possible illegal practices of News Corp in the U.S..
Some officials of the Federal Reserve were willing to further easing in monetary policy if the recovery was too soft to flow back as long as unemployment and inflation is slowing, according to the minutes of the last meeting of the U.S. central bank Tuesday.
The Fed had not so far as clearly suggested that a third series of so-called quantitative easing could be considered after the end of the second round of $ 600 billion, known as QE2 in late June
Other members of the Fed at the meeting of June 21 and 22 disagreed.For them, if the acceleration of price increases will not calm down, the Fed should consider tightening its monetary policy more quickly than expected.
All members of the Monetary Policy Committee (FOMC), however, felt that the recovery had slowed since their April forecast and estimated that the recent deterioration of conditions in the labor market was a particular concern because it was likely to weigh on consumer spending.
Most analysts believe the next move by the Fed will raise interest rates rather than offer new support measures by buying bonds or maintaining rates at historically low levels.
However, the markets believe the Fed will not increase its rates by mid-2012.
The Federal Reserve Chairman Ben Bernanke encountered all member of Congress for two days on Wednesday and Thursday for his speech six months. On this occasion it should give details of internal discussions at the Fed. It will start on Wednesday to be questioned by members of the Financial Services Commission of the House of Representatives.
The Fed has also alluded to the problem of raising the ceiling of the debt of the United States.She believes that if nothing is done by August 2, the United States will find themselves unable to fulfill certain obligations.
"Even a short delay in the payment of principal or interest on Treasury bonds could cause major disruptions in the markets and could also have a lasting effect on borrowing costs in the United States," we read in the account Proceedings of the FOMC.