Buzz In Business

The International Monetary Fund has given priority to poor countries by stating that it will take certain steps to help poor countries in the present recession scenario. Many poor countries are in great trouble because of the economic problems worldwide. IMF recently made the statement that it will increase funding to poor countries by up to 17 billion dollars from now till 2014. Also, it will suspend the interest on certain loans that have been given to poor countries. IMF is planning to sell its gold reserves to meet its goal of generating funds.

In April during the G20 summit, the participating countries called for more lending by IMF. This will definitely help countries in sub – Saharan Africa and other poor countries around the globe according to Dominique Strauss-Kahn who happens to be the head of IMF. According to the IMF, though a lot of poor countries were making economic progress but because of the recession this progress was getting jeopardized. Read the rest of this entry »

A two day meeting is taking place between U.S. and China. President Obama will address the meeting which is being attended by Wang Qishan and Dai Bingguo, Chinese Vice Premier and State Councillor respectively. It seems that China is worried about the value of dollar. Currently China holds more than 800 billion dollars of US debt. Apparently this number is for US Treasury alone.

The Chinese government is scared that inflation will be there in U.S. especially after looking at the way President Obama is spending. The Chinese fear that the value of dollar will go down and hence causing the U.S. debt which China holds, to devalue significantly. Timothy Geithner, U.S. Treasury Secretary, will try his best to assure the Chinese regarding their assets. He will require a new approach as he has already tried to convince China regarding this issue previously though he didn’t meet success.

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Unemployment is at all time high in U.K as there was an increase of 281,000 in the number of unemployed people in three months to May. According to the Office of National Statistics, there are 2.38 million unemployed people in U.K. This is the highest unemployment in U.K. in more than 10 years with unemployment rate hitting 7.6%. The degree of the problem becomes more visible when we see an increase of 23,800, in the month of June, in the number of people who are taking unemployment benefits.

Highest unemployment growth has been in the group of young people. With 726,000 unemployed young people, this is the highest unemployment since last 16 years for young people. Another concern is that the number of young people out of work for over a year has gone up to 528,000, highest in last 11 years.

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The Real Estate business is improving in U.S. with an increase in the sales of homes. The sales have been increasing for third month in a row in June. Also, the increase has been better than expected. Sales which were 4.77 million in May rose to 4.89 million in June.

Even though sales have gone up in the market, there is no improvement in prices. They are still 15.4% down as compared to last year. Despite the lowered prices, most analysts believe that the market is improving. Also, the soothing factor was that the increase in house sales is evident all over the country.

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Porche finally gave in to the months – long power struggle to Volkswagen when it fired its chief executive. Also, it declared that it will try to raise €5 billion in equity for the possible merger of Volkswagen and Porsche. Porsche’s board of directors meeting came to an end with the announcement that Porche’s CEO, Wendelin Wiedeking, and finance chief Holger Haerter will be quitting the group.

With the exit, the CEO will be paid off €50 million while the finance chief will get €12.5 million. Wiedeking will be replaced by Michael Macht who is currently the Production head of Porsche. Wiedeking has always been against the idea of Volkswagen buying Porsche.

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Thanks to iPhone sales especially that of its new 3GS model, Apple’s quarterly results turned out to be better than expectations. Apple sold 5.2 million iphones in this quarter which was seven times better than its sales a year ago. The declaration by Apple resulted in an increase in its shares prices also.

Last year in the third quarter the net profit was 1.07 billion dollars while this year it has reached 1.23 billion dollars. Apple’s profit continues to amaze analysts around the world. Also, a growth in the MAC business combined with iPhone’s performance is turning out to be an effective combination.

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