Top Economics News

Barcelona and Madrid are struggling to accommodate "Eurovegas", a project that could generate 164,000 direct jobs and 97,000 indirect jobs. An employment agency in Malaga. Spain has an unemployment rate above 20%

Under the slogan "No Eurovegas", a platform to mobilize citizens to Spain to fight against the project a huge casino complex, inspired by Las Vegas and expected to provide over 260,000 jobs in a country affected by unemployment record.

"It's the return of the economic model of the building to a fault, it's not a sustainable source of employment," denounced one of his representatives, Ana Sanz, during the presentation of the platform form in Madrid on Wednesday. "This project is going back to a model that failed with the crisis," added another member of the group, Carlos Ruiz.  

"This project" is a huge complex centered around the game, which are fighting for the two largest Spanish cities, Barcelona and Madrid. "Eurovegas" as he was nicknamed, involves the construction of six casinos, 12 hotels offering 36,000 rooms, nine theaters and three golf courses, according to Spanish media. It will generate an investment of 15 to 18.8 billion euros and the creation of 164,000 direct jobs and 97,000 indirect jobs.

Its promoter: the gaming giant Las Vegas Sands, owned by American billionaire Sheldon Adelson, who is expected to announce in early summer if the giant complex will be the day or not, and if so, which of the two cities is drawn . But official data are not easily accessible and opponents denounced Wednesday "opacity" surrounding the project.

The numbers of jobs "that we are selling are not real," says Ana Sanz also. Mired in crisis, Spain in late 2011 showed a record unemployment rate of 22.85% and almost a quarter of its workforce (24.3%) should be unemployed by the end of the years, according to government forecasts. In this grim context, perspective, even fuzzy, a project expected to generate 261,000 jobs enthusiasm the political and economic leaders.

"More than half of Madrid unemployed could find work", was launched in February the President of the Madrid region, Esperanza Aguirre, saying negotiate with billionaire since 2006. "We will change all the rules need to be changed, so long as is consistent with our principles", she also promised. For its part, the president of Catalonia, Artur Mas, has said the project would drain a "quality tourism".  

In addition to a return to the worst excesses of the housing boom that fueled the Spanish economy until the bubble burst in 2008, critics of "Eurovegas" denounce them preferential treatment, and legal tax proponents have claimed. "It will be a free zone where laws will be imposed by the investor," worries Carlos Ruiz. He said Las Vegas Sands would have required such that "any request for funding, the Spanish state shall guarantee" that "the project companies do not pay VAT," a moratorium "on ten years of taxes on the game "and further that" it changes the law on money laundering ".

Smoking would be allowed in the complex, while smoking is prohibited in bars and restaurants in Spain since January 2011. "There is a risk of opening the mafia of prostitution," added another representative of the platform, Cristina Fernandez. According to the spokesman for Las Vegas Sands, Ronald Reese, "negotiations with all levels of government are very advanced." "I assure you that these are not agreements that will change the structure (legal) Madrid, Barcelona or Spain," he added last week on public television. However, without reaching to reassure his critics.

Equity markets have appeared hesitant and versatile throughout the session. The European equity markets ended in a disorganized, while at the same time, Wall Street also hesitated between increases and decreases.

Investors have welcomed the drop in bond yields Italian and Spanish through purchases of securities by the European Central Bank in the secondary market.

Traders also mention the idea that the ECB would lend the International Monetary Fund (IMF) to assist countries in the euro area.

But operators remain skeptical, however.

U.S. inventories of crude oil fell against all expectations last week, said Thursday the U.S. Agency for Energy Information (EIA).

Crude inventories fell 1.37 million barrels to 338.09 million. Economists on average had expected a rise of 400,000 barrels.

Gasoline inventories fell 2.11 million barrels (consensus: 300,000), to 204.17 million.

The reserves of distillates, which include heating oil, fell by 6.02 million barrels (consensus: -2.0 million) to 135.87 million.

The rate of capacity utilization of refineries dropped 2.7 points to 82.6%.

Around 3:50 p.m. GMT, U.S. crude reduced its losses, yielding 1.3% to 95.80 dollars a barrel.

European leaders are determined to act in a coordinated response to the crisis in the euro area, said Wednesday the executive director of the International Monetary Fund, Christine Lagarde.

On the eve of the G20 summit in Cannes, the former French Finance Minister acknowledged that could occur in spurts, a thinly veiled reference to the surprise announcement of a referendum in Greece, but it ensured that the determination of the Europeans was decisive.

When working at B20, which brings together representatives of world's largest companies, in Cannes, she explained that global growth was slowing, but she persisted.

She added that the downside risks weighing on growth, suggesting a negative interaction of financial and economic, as well as the risk of social unrest.

About the crisis in the eurozone, "I've never seen so much determination and will to act in a coordinated manner," said Christine Lagarde.

"You will see (reactions such as) 'but what does it speak? What have we seen two days ago?' Of course, things are not smooth, sometimes in fits and starts major, "she added.

"But what matters is what was decided on October 27 in the morning (…) and what will count tomorrow, in the days, weeks and months, it is the resilience and determination of the partners the euro, European partners, "added Christine Lagarde.

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.

The German Government has almost halved its growth forecast for next year, reduced to 1% against 1.8% auparavan.

After several economic research institutes, the German government has significantly revised down its growth forecast for next year, noting the slowdown in the economy under the weight of the financial crisis in Europe. Berlin now expects growth of Gross Domestic Product (GDP) by 1% in 2012, nearly half its previous estimate of 1.8%, said Wednesday sources close to the government. This forecast should be formalized Thursday by the Ministry of Economy.

The reduction comes as no surprise. Signs of a slowdown in the dynamics have increased recently. The latest business survey, the ZEW, which measures the expectations of analysts and institutional investors, reached Tuesday its lowest level since December 2008.The Ministry of Economy considered himself last week that the risks had "significantly increased" for the first European economy, strong exports. Germany suffers from weaker growth in its European partners, which absorb 60% of its exports.

The main economic research institutes predicted the country in their autumn report, which is the basis for forecasts of Berlin, a decline in GDP in the fourth quarter 2011, followed by stabilization at a low level. The export will not contribute to growth next year, they warned.

Strong last year after the terrible recession of 2009, German growth has largely continued this year and should reach 2.9%, putting Germany in the forefront of Europe.

German manufacturers of cars, machine tools and chemicals filled their order books since last year, and "the companies still much to do to fulfill their orders," Analysis Carsten Brzeski, economist at ING, "this time, they are much better prepared to face a crisis of Lehman type ". The recession following the collapse of U.S. investment bank in 2008 had occurred in a phase of over-capacity of German industry, breaking net momentum.

In the area of ​​machine tools, high of about one million employees and a major exporter, the production growth should slow markedly course next year, warned Tuesday the federation VDMA, but at 4%, remain fully is honorable.

The sequence of events for the German economy, that is "an anchor of stability and growth in Europe" in the words of its Minister of Economy, will very much depend on the outcome of the debt crisis.

EU leaders promise solutions in the coming weeks, and the business press them to do so. But if the remedies proposed were not sufficient to stem the crisis, "the German economy would be penalized more than expected, and would fall into recession," predicted institutes last week. The export collapse, consumer confidence, yet relatively untouched because of a strong labor market, would be reached, and the banking crisis handicap investment, according to worst-case scenario.

Total discovered gas and oil off the coast of Norway, announced Thursday the Norwegian Petroleum Directorate.

According to preliminary estimates, this discovery is to be between 19 million and 101 million barrels.

The discovery was made in the Norwegian Sea, about 8 miles west of the oil and gas Norn.

"The development of this discovery will be considered in conjunction with other deposits in the region," said the Norwegian Petroleum Directorate said in a statement.

To dig the well that led to this discovery, Total was allied with Norway's Statoil, authorities said.

Standard & Poor's Tuesday lowered a notch credit rating of ten Spanish banks, including the two largest in the country, pointing to the darkening economic prospects and a housing market still depressed.

Fitch Ratings has reduced its share shortly after the note of six banks in the wake of its decision, announced Friday, to lower the rating of Spain by two notches to AA-.

Among the banks downgraded by S & P are Santander and BBVA, key institutions of the country.Their two notes back from AA to AA-and carry a negative outlook.

S & P also revised the rating outlook for four banks, reducing it from stable to negative, and placed the bank under review with negative implications.

The prospect of all banks rated by S & P is now negative, meaning that further declines are possible notes.

Fitch, Banco Santander fell from AA to AA-and Banco Bilbao Vizcaya Argentaria (BBVA) from AA-to A +.

Other banks involved include Banco Popular Espanol to BBB +. This note is placed under review with negative implications because of its exchange offer launched on Banco Pastor.

Job creation increased this summer and the growth of the wage bill is expected to exceed 3.6% this year. Good news for Social Security accounts. A turnaround is not excluded. Officers, employees

Not everything is black on the employment front. Although the number of registered unemployed at employment center is rising considerably and the last three months. But several indicators released today by ACOSS (the agency responsible for collecting contributions for Social Security) have shed light on this first day of autumn.

After a slight dip in May and June, reports of recruitment of more than a month in the private, non-temporary, considered a leading indicator of labor market, rose 4.6% in August compared in July, to 648,000, an increase of 10.6% over the year. Declarations of hiring on permanent contracts are also up: 290 000 in July.Levels comparable to those before the crisis, during the period 2002-2007.

This flow of hiring has drawn the net job creation on the rise (+0.2% over three months in July, 1.6% yoy). Other indicators on the financial health of companies also are facing: the default rate, requests for payment deadlines and the number of bankruptcy remained broadly stable.

"Our data are quite encouraging" while "the overall context is excellent," said during a press briefing Pierre Burban, the President of ACOSS. "There was the first half of job retention and maintenance of payroll," he said. Indeed, the wage bill increased by 0.9% in the second quarter compared to the first and 3.8% year-over-month rolling.Growth consistent with the long-term average over the decade 2000-2008.

1.5 billion of revenue in addition to the social security

The really good news is that even if the wage stagnation for the next six months, the growth overhang already reached 3.55%. According to ACOSS, the annual increase should exceed 3.6%, 0.4 points above the government's latest forecast in the supplementary budget in June. Good news for Social Security should be able to save at least 1.5 billion euros in additional revenue.

But all is not rosy either. The second quarter was marked by a slowdown in the dynamics of the curve of employment. Thus, the increase in job creation was twice as high in the first quarter (+0.5%), and the amount of overtime, which had been buoyant in recent months has slowed sharply in July, 1.1%.In addition, temporary employment, considered a leading indicator of the labor market, fell by 0.6% while it rose by 5% per quarter in recent months.

These indicators are perhaps the first signs of a turnaround in the labor market, timely adjustment of enterprises to the economic impact varies from one to three months. Or the stock market crisis erupted in late July and has been a really dramatic turn for the banks in August. It is also the end of August the government took note of the slowdown in the French economy and revised its outlook for 2011 and 2012 downwards.