ST. LOUIS
Spanish protesters of all stripes _ young and old, working and unemployed _ marched Sunday in Madrid to drive home their anger over high unemployment, bleak economic prospects and politicians they see as inept.
Similar demonstrations were being held later in other cities including northern Barcelona, eastern Valencia and southern Seville. Police were out in force after a Wednesday protest in Barcelona turned violent.
Prime Minister Jose Luis Rodriguez Zapatero said he expected the protests to be peaceful.
“A sacred rule of democracy is that in the exercise of rights you do so peacefully,” he said.
Nearly two years of recession have left Spain with a 21.3-percent unemployment rate _ the highest in the 17-nation eurozone _ and saddled with debt. The jobless rate, which has more than doubled since 2007, jumps to 35 percent for people aged 16 to 29. Many young, highly educated Spaniards can’t find jobs as the eurozone’s No. 4 economy struggles with low growth.
Protests began May 15 and spread to cities across the country, striking a chord with hundreds of thousands fed-up with the wage cuts and tax hikes needed to resolve a financial crisis they see as created by banks and wealthy developers free credit report and score.
Protester Antonio Cortes, 58, said Spain’s workers were being asked to bear the brunt of the financial crisis.
“This crisis was created by the capitalist financial system and we are paying for it. All the cuts shouldn’t be aimed at the working class,” he said.
Marchers departed from six points around Madrid bearing banners saying “Let’s march together against the crisis,” heading to Neptuno square near the country’s parliament building.
Zapatero’s government has tackled the crisis by cutting government spending, freezing pensions, raising the retirement age and making it easier and cheaper for companies to lay people off.
Spain slipped into recession in 2008 after a real estate bubble burst, halting a credit-fueled consumer spending spree.
It has not needed or sought an international bailout like fellow eurozone members Greece, Ireland and Portugal, but its financial troubles strike fear in other European capitals due to the sheer size of its economy.
The Canadian Solar Industry Association is trying to raise $2 million from its members to mount a media campaign in Ontario, promoting the benefits of solar.
A message to members says the campaign is needed because
St. Louis-based Swan Corp. hired Michael Fischer as its president and CEO.
He has more than 30 years of experience in the building products industry in sales, marketing and manufacturing. He joins Swan from Formica Corp., where he served as president.
Fischer joined Formica in 2002 and was its vice president of sales before becoming its president. Previously, he was an executive at Armstrong World Industries.
The operator of Japan’s radiation-leaking nuclear plant has agreed to drastic restructuring and cost-cutting in exchange for a government plan to support the company in its obligations to compensate people affected by the crisis.
Tokyo Electric Power Co., which operates the Fukushima Dai-ichi plant, said Wednesday it accepted the government-set reorganization plan. To insure damages, the government plans to create a fund of mandatory contributions from electric utilities in case the total exceeds TEPCO’s financial capacity.
TEPCO has sought a 2 trillion yen ($24.8 billion) loan to tide it through the initial emergency. It also expects to pay 50 billion yen ($620 million) in initial compensation to the nearly 80,000 residents evacuated around the plant. Overall damages are expected to be much higher.
German industrial production rose for a third month in March as construction surged, adding to signs Europe’s largest economy gathered strength in the first quarter.
Output increased 0.7 percent from February, when it rose 1.7 percent, the Economy Ministry in Berlin said today. Economists had forecast a gain of 0.5 percent, the median of 21 estimates in a Bloomberg News survey showed. In the year, production rose 11.2 percent when adjusted for working days.
Germany’s economy has powered euro-region growth as companies boosted spending and hiring to meet export demand. Continental AG (CON), Europe’s second-largest auto-parts maker, yesterday reported its highest profit in more than three years. The economy may have expanded as much as 1 percent in the first three months of the year and may maintain its growth momentum in the current quarter, according to the Bundesbank.
“With today’s industrial production numbers, a smashing growth performance in the first quarter is almost done and dusted,” said Carsten Brzeski, an economist at ING Group NV in Brussels. “Even if the period of almost Chinese growth rates has come to an end, the German economy will remain the economic powerhouse of the euro zone.”
The euro traded at $1.4529 at 1:15 p.m. in Frankfurt, little changed from yesterday.
Construction Surge
Construction jumped 6.2 percent in March from the previous month, when it advanced 3.4 percent, today’s report showed. Manufacturing output rose 0.5 percent and production of investment goods gained 0.8 percent. The ministry revised up the gain in overall February industrial output from 1.6 percent.
While the “upward trend” production continues, it may “moderate to some extent,” the ministry said. The surge in construction output was “probably exaggerated,” it added.
Siemens AG (SIE), Europe’s largest engineering company, said on May 4 profit this year will rise at least 75 percent as companies step up investment in industrial equipment payday loan lenders. Munich- based Siemens has created 12,000 jobs worldwide since October and still has 3,800 unfilled positions in Germany alone, Chief Executive Officer Peter Loescher said.
The German economy will expand 2.8 percent this year and 2 percent in 2012, the country’s leading economic institutes, which advise Chancellor Angela Merkel, predicted last month. In 2010, the economy grew a record 3.6 percent. Unemployment fell below 3 million for the first time in almost 19 years in April on a seasonally adjusted basis.
‘Success Story’
The economy may struggle to gather strength as surging oil prices leave households with less money to spend while governments from Ireland to Spain toughen austerity measures. Factory orders unexpectedly dropped in March from the previous month, the ministry said yesterday. Business confidence weakened in April and investors also grew less optimistic.
The European Central Bank yesterday kept its benchmark interest rate at 1.25 percent, with President Jean-Claude Trichet saying in an interview with Bloomberg Television today that a drop in crude oil prices to below $100 a barrel is “good from the inflation standpoint,” while also helping the economic recovery.
“The best in terms of dynamic probably lies behind us,” said Alexander Koch, an economist at UniCredit Group in Munich. “This does definitely not signal an imminent end to the success story. So far, all clear for the industry fast train.”
Companies in the U.S. added workers in April, signaling the labor market is strengthening, data from a private report based on payrolls showed today.
Employment increased by 179,000 in April from a revised 207,000 the prior month, according to figures from ADP Employer Services. The median estimate in the Bloomberg News survey called for a 198,000 advance this month.
The gain in employment projected by ADP may be insufficient to help the economy accelerate after a surge in food and fuel costs caused growth to slow to a 1.8 percent annual rate in the first three months of the year. Businesses added 200,000 jobs in April and the jobless rate held at 8.8 percent, economists project a Labor Department report to show in two days.
“This pace keeps things moving forward but not at a strong enough growth rate to really, really improve labor market conditions and improve the economy,” said Steven Ricchiuto, chief economist at Mizuho Securities USA Inc. in New York who forecast a gain of 175,000. “The labor market is still underperforming the expectations where growth will be and should be at this point.”
Estimates for the ADP data ranged from increases of 164,000 to 240,000, according to the Bloomberg survey of 34 economists.
Over the previous six reports, ADP’s initial figure was closest to the Labor Department’s first estimate of private payrolls in February, when it understated the gain in jobs by 5,000. The estimate was least accurate in December, when it overestimated the increase in employment by 184,000.
Fewer Firings
Another report today showed U.S. employers announced fewer job cuts in April than the same month last year, a sign that the labor market is firming. Planned firings decreased 4.8 percent to 36,490 last month from April 2010, according to Chicago-based Challenger, Gray & Christmas Inc. Government agencies accounted for the biggest cutbacks by industry.
Stock-index futures were little changed after the report. The contract on the Standard & Poor’s 500 Index maturing in June was at 1,352.1 at 8:58 a.m. in New York, matching yesterday’s close.
Today’s ADP report showed an increase of 41,000 workers in goods-producing industries, which includes manufacturers and construction companies. Employment at factories rose by 25,000.
Service providers added 138,000 workers, ADP said.
Companies employing more than 499 workers expanded their workforces by 11,000 jobs. Medium-sized businesses, with 50 to 499 employees, created 84,000 jobs and small companies also increased payrolls by 84,000, ADP said.
Economy Recovering
“Employment has begun to show signs of improvement,” Scott Davis, chief executive officer of United Parcel Service Inc. (UPS), said during an April 26 call with analysts. “In the U.S., unemployment dipped below 9 percent for the first time in almost two years, further evidence that the recovery continues.”
While payrolls have grown each month since October, Federal Reserve Chairman Ben S. Bernanke said on April 27 that central bankers would like to see more strength in the U.S. labor market, noting that a recovery has been “quite slow.”
“The labor market is improving gradually,” Bernanke said to reporters during the first-ever press conference following a Federal Open Market Committee meeting. “We would like to make sure that that is sustainable. The longer it goes on, the more confident we are.”
‘Anemic’ Recovery
Federal Reserve Bank of Boston President Eric Rosengren today said record stimulus is necessary to spur the “anemic” economy and that raising interest rates to combat increasing food and fuel prices would impede growth.
“With significant slack in labor markets, stable inflation expectations, and core inflation well below our longer run target, there is currently no reason to slow the economy down with tighter monetary policy,” Rosengren said in prepared remarks for a speech in Boston.
Overall payrolls, which include government workers, probably rose by 185,000 in April, according to the median forecast of economists surveyed before the Labor Department’s May 6 report.
The ADP report is based on data from about 340,000 businesses employing more than 21 million workers.
India’s inflation accelerated more than economists estimated in March as the cost of fuel and manufactured goods rose, putting pressure on policy makers to raise interest rates in Asia’s third-largest economy.
The benchmark wholesale-price index rose 8.98 percent from a year earlier after an 8.31 percent gain in February, the commerce ministry said in a statement in New Delhi today. That exceeded all 28 estimates in a Bloomberg News survey, where the median forecast was for an 8.36 percent increase.
Expansion in India’s $1.3 trillion economy has boosted consumer demand and spurred manufacturing, car sales and credit growth, stoking price risks and prompting the central bank to raise rates eight times since early 2010. Inflation in the first quarter has exceeded the Reserve Bank of India’s forecast that price increases would be 8 percent by the end of March this year.
“Inflation is going to remain uncomfortably high this year,” said Leif Eskesen, Singapore-based chief economist at HSBC Holdings Plc. “The RBI needs to raise rates more aggressively and we are looking at three more rate increases this year.”
The Bombay Stock Exchange’s Sensitive Index extended declines after the inflation report, falling 1.4 percent at 11:52 a.m. in Mumbai. The yield on the 8.08 percent bond due in August 2022 was at 8.25 percent, compared with 8.21 percent before the data was published.
Rate Increase
Rising oil and commodity costs and sustained economic growth are escalating pressure on Asian central banks to boost borrowing costs. China on April 5 raised rates for the fourth time since mid-October. Vietnam, Taiwan, South Korea and Thailand also increased borrowing costs this year to curb inflation, and Singapore said yesterday it would allow further currency gains.
China’s economy grew a more-than-estimated 9.7 percent in the first quarter and inflation accelerated in March to the fastest pace since 2008, with consumer prices rising 5.4 percent from a year earlier, a report showed today.
Reserve Bank Governor Duvvuri Subbarao on March 17 increased the repurchase rate by a quarter point to 6.75 percent after raising the inflation forecast for the second time since late January, when he estimated it at 7 percent by March end. The central bank’s next monetary policy announcement is scheduled for May 3.
Food Inflation
“In the absence of a strong supply response, increasing demand will inevitably lead to higher prices,” Reserve Bank Deputy Governor Subir Gokarn said April 5. He said a “monetary response is warranted” should demand exceed supply and stoke inflation.
Manufactured-products inflation was 6.21 percent in March, compared with 4.94 percent in February, today’s report showed. Fuel and power prices rose 12.92 percent, compared with 11.49 percent the previous month. India relies on imports to meet three-quarters of its annual energy needs.
Food prices rose 8.28 percent in the week to April 2, compared with 9.18 percent in the previous week, the commerce ministry said in a separate report today.
India’s economy may expand as much as 9.25 percent in the year ending March 31, 2012, the finance ministry said in February.
Production Growth
Still, India’s industrial production growth unexpectedly slowed to 3.6 percent in February, a report showed this week.
“Even as industrial production continues to be volatile, other indicators, such as the latest purchasing managers’ index, direct and indirect tax collections, merchandise exports and bank credit, suggest that the growth momentum persists,” the central bank said in the March 17 statement.
India’s industrial output has fluctuated since May, when it registered a 12.2 percent expansion. The growth eased to 7.2 percent in June, rebounded to 15.1 percent in July, slid to 4.9 percent in September and then recovered in October, according to government data.
Recent data show lenders are giving loans at a faster pace than the central bank’s target. Commercial loans rose 21.4 percent from the previous year as of March 25, more than the 20 percent rate prescribed by the Reserve Bank of India.
Rising Salaries
Manufacturing grew for a 24th straight month, with the purchasing managers’ index holding unchanged at 57.9 in March from February, when it accelerated at the fastest pace in three months, HSBC Holdings and Markit Economics said April 1.
Salaries in India this year may rise the most in the Asia- Pacific region, fueling consumer demand, a survey by Aon Hewitt LLC showed March 8. Spending under the government’s National Rural Employment Guarantee Act of 2005 has surged almost fourfold to 399 billion rupees.
Demand may find more support from Finance Minister Pranab Mukherjee’s budget for the fiscal year ending March 31, 2012, which plans to spur spending and exempt incomes below 180,000 rupees from tax, higher than the previous threshold of 160,000 rupees.
A battle for control of the New York Stock Exchange moved into dueling appeals to shareholders Monday, a day after a rival bidder complained that its $11.3 billion bid was rejected without discussion.
NYSE Euronext Inc. said Sunday that its board decided to turn down an offer from rival Nasdaq OMX Group Inc. and IntercontinentalExchange Inc. because it was “highly conditional” and would have caused unnecessary risk for shareholders. Instead, the company reaffirmed its plan to combine with German exchange operator Deutsche Boerse AG in a $10 billion deal.
Nasdaq and Intercontinental Exchange Inc. say their bid is “clearly superior.” ICE Chairman and CEO Jeffrey Sprecher said that by declining to meet with Nasdaq and ICE, the NYSE’s board was ignoring its obligation to its stockholders.
“I would expect that NYSE Euronext’s stockholders will make their displeasure known to the board,” he said.
As NYSE’s annual shareholder meeting looms on April 28th, the time is narrowing for NYSE executives to convince their investors to stick with the agreed-to bid in the face of a more lucrative offer. Nasdaq and ICE will continue to meet with NYSE shareholders in an attempt to put pressure on company executives and force a meeting, according to people familiar with the two companies’ plans cash till payday advance.
The structure of the NYSE agreement with the German exchange as a merger, rather than a sale, could give the company’s board a legal justification to reject a higher offer, analysts say. But those points may become moot if Nasdaq or ICE is successful in convincing NYSE shareholders to become directly involved through a proxy vote or a tender offer, said analyst Richard Repetto.
The higher offer comes with its own risks, such as the lack of a break-up fee that would be paid to NYSE shareholders in case the deal does not go through. Chief among the risks is whether the Nasdaq-led bid could pass regulatory hurdles by combining virtually all U.S. stock listing under one roof, a move that would lead to job losses in the financial services industry.
“The anti-trust problem is immense and unprecedented,” said John Coffee, a professor at Columbia Law School who is an expert in securities law. “You never saw General Motors and Ford merge.
The other key issue is the use of debt to finance the deal. Nasdaq would borrow up to $3.8 billion as part of its offer, a risk that some analysts said could prompt ratings agencies to downgrade the company.
Regulators have shut down a small bank in Illinois, lifting to the number of U.S. bank failures so far this year to 27 after 157 succumbed in 2010 to the gutted economy and mounting bad loans.
The Federal Deposit Insurance Corp. have seized Western Springs National Bank and Trust, in Western Springs, Ill., with $186.8 million in assets and $181.9 million in deposits. Heartland Bank and Trust Co., based in Bloomington, Ill., will assume the assets and deposits of the failed bank no fax payday advances.
In addition, the FDIC and Heartland Bank and Trust have agreed to share losses on $100.8 million of Western Springs National Bank and Trust’s loans and other assets.
The failure of Western Springs National Bank is expected to cost the deposit insurance fund $31 million.
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