The recession kills

Workers are going through a rough emotional period. A recent American consultancy's survey has conveyed that, as a result of unsatisfying jobs and low expectations of moving up on the firm's ladder due to the economic crisis, the suicide rate has skyrocketed. Performance-hungry bosses lacking responsibility in the human managing field, leave many employees behind without any hope or motivation. Luckily, companies are starting to realize that good hierarchic relations are vitally important for the firm's long term succes.

Arno Coene

Eureopean banks are resistant to a new crisis.

A stress test for the banking sector CEBS, has been announced which would allow banks to survive, even when economic growth decreases or the unemployment rate leaps. This survival would be made possible by government injections although banks all together would still have a loss of 400 miljard euros. ECB-president, Jean-Claude Trichet, says the results are encouraging, however, critics think the tests are meaningless.

Vervondel Laurent, Group 8.
Source: http://www.fd.nl/artikel/13344999/europese-banken-kunnen-nieuwe-crisis

Desperate times ask for... desperate measures?

Société Generale announced Tuesday a drastic solution to deal with the enormous emergency state loans of 3.4bn euros all in once by raising a generous 4.8bn euros.
The bank plans to repay the French state loan with this grotesque effort while SocGen's dreaming of an expansion with the other 1.4bn euros by pursuing potential takeovers and thus staying ahead of the competition.
The existing shareholders would get priority to buy further two shares for each nine they own bearing in mind that the new stock price is rated at a disappointing 31% discount compared with the current value. The banks latest results showed an amazing loss of profits by 52% despite rumours of better performance.

Mattias Dierickx
source: BBC NEWS, De Standaard Online

crisis tax on banks

The reckless short-term profitdriven wild or even cowboy capitalism of the financial sector as it is now being called is, among other things, what caused this current recession, so why should your average tax payer suffer the costs?
That's what ABVV(socialist trade union) chairman Rudy De Leeuw is arguing for and it seems he isn't the only one who feels this way.
Deputy PM Laurette Onkelinx of the walloon socialist party agrees and already has some ideas how this would be enforced, one of which is stripping banks of some tax benefits. Although there is a general sense of punishing those who are to blame they have yet to reach a consensus on how this should be done and even who, after all not every bank needed government help to stay afloat.



Simon Ghiotto

Homeowners win right to sue over mortgages

In America, a lot of homeowners aren't able to pay back their mortgages. Although the housing market has been crashed, the prices of the houses are very high compared with 10 to 15 years ago. Many of the borrowers don't have to pay back a fixed amount to the bank, but the loan depends on the increase in the value of the house. More than 300 homeowners have been united and they now sue Barclays and Bank of Scotland for selling such risk-bearing mortgages.

Thomas De Coninck

http://business.timesonline.co.uk/tol/business/law/article6863171.ece

Google miscalculated in take-over YouTube

When Google took over YouTube in 2006, they paid 1 billion dollar too much, says Eric Smidt, Google’s CEO. Smidt estimated the value of YouTube by 600 million till 700 million dollar, but Google paid 1,65 billion dollar to beat their competitors, despite of the warning of some critics, who said YouTube wasn’t profitable enough. It’s twice painful because it happened just before the worldwide bank and financial crises. However, Google is a big company and in 2008 it had a turnover of circa 28,5 billion dollars, but 1 billion dollar is still a serious amount in this times.

Valentijn Deltour

Recovery for the Tourism Sector?

“The international tourism sector, that has got a heavy blow by the impact of the rapid deterioration of the World economy and the effects of the influenza outbreak this spring, will revive next year. Certain indications lead one to suspect that we could expect a recovery in 2010” reports Taleb rifai, UNWTO Secretary-General. There is still an uncertainty about the strength of the World-wide economical recovery, and the effects of the influenza on tourism are too difficult to estimate. In Rifai’s view, the current year will be concluded with an average decrease of 5%.

Nele Aelter

Experts are afraid of a new crash at the stock exchange!

It was certainly the biggest depression since the crisis in the early 30’s, but now we see a growing gap between the evolution of the stock exchange and the economic activity. The investors are too enthousiastic about the economic growth and when they will notice their mistake, professor Roubini expects a correction (a new decrease) of the stock exchange. Last week the stock exchange fell by 2% because the American production didn’t increase fast enough. Investors are uncertain about a new growth and Michael Georghegan, magnate of the giant bank HSBC, is even more pessimistic, he doesn’t only see a new decrease at the stock exchange but also a further fall in the whole economy.

Less foreigners on the labour market

Fewer foreigners are hired in Belgium as a result of the economic crisis. It is less attractive for employers to recruit expatriates because they need to request a labor license for them.In comparison with last year, there was a decrease of 33% in allotments of labor licenses in the past months. There are also less and less people going abroad to earn more money.

Lise Braeckman

Baron Van Steenkiste was released

Baron Luc Vansteenkiste was in custody on suspicion of using inside knowledge in the Fortis case.
Last year Luc Vansteenkiste learned during a conference call of the Board of Directors of Fortis that it would be dismantled. The baron passed on this information to Bois Sauvage, that used this information to liquidate its shares of Fortis. This way Bois Sauvage avoided a loss of €14 million, unfortunately a transaction based on inside knowledge is not allowed!

Christophe Boucquet

Phishing slows online banking.

A couple of banks have introduced security measures against phishing attacks, because the number of attacks has a big increase the last 18 months. The measures who are taken by the banks have an influence for some electronic transfers. It’s possible that there’s a delay for payments, those delays allows the systems to check the payments and search for unusual payments. Laurence Baxter of consumers association ‘ Which? ‘ wants that the banks speed up the payments but the banks must ensure that they do that on a secure way.

Jan De Byser

Source: http://news.bbc.co.uk/2/hi/programmes/moneybox/4569095.stm

Appetite for risk

While banks still doubt about making new loans, the debt and equity markets are being attracted by risks. Because of that the initial public offering (IPO) market is open for business. The two IPOs in America in the half year following the bancruptcy of Lehman Brothers in September 2008 vanish compared to the seven IPOs in America in the last full week of September 2009. On top of that the conditions for new loans are even better than before the economic crisis.

Laurence De Scheerder

Source:

Recession and opportunities?

Market leaders are the most obvious winners during the recession because they enter with a lot of cash in their pockets, use their corporate power to squeeze their costs and take advantage of bargain-basement prices to make acquisitions and so they win market share.

The second group of winners are the companies that have a record in innovation. These companies invest their way out of recession.

The third group of companies that finds opportunities during recession are these that reposition there selves by using cash reserves to snap up start-ups in new fields and expand its business portfolio.

Karla De Bot

http://www.economist.com/businessfinance/displayStory.cfm?storyid=14540023

Gold prices hit 18-month highs

Tuesday, 8 September


The price of gold edged to its highest level in 18 months today as investors seek alternative homes for their cash amid US dollar weakness and predicted continuing low interest rates.
The metal is traditionally seen a 'safe' investment for investors and tends to benefit when markets and economies hit troubled times.
Gold has enjoyed a significant rally in recent days, rising by $50 since September 1. It reached an all-time high of around $1,033 last March, as worries about the financial crisis brewing in the US hammered the country's currency.

Goethals Delphine

Crisis makes air cleaner

Belgium can achieve the kyoto protocol as a result of the economic crisis. Flemish enterprises reduced their CO2 emission by 50 percent, entirely due to the crisis.
So far, The Bond Beter Leefmilieu is economical with his enthusiasm because there'll be particular adverse effects. The crisis delayed the investment in clean technologies and at the end of the crisis, the companies will rise their emissions again.

Bruno Bloeyaert

Bank fees you don't know you're paying

Although banks have recaptured the trust of their customers by cutting overdraft fees, there are still other hidden charges they pay for.
Some banking giants have announced serious changes to their overdraft policies, but in fact the average customer still pays a $100 or more a year, due to these fees.
There are five major areas of hidden bank revenues you should watch out for:
balance transfer fees, cash advances, foreign currency surcharges, balance requirements and ATM fees.
Customers should be aware of these hidden traps, always ask your bank for further detailed information!


Naomi Lako
Link

Finally investors experience positive signals

Though last week the macro-economic rates were not so good, now investors will be pleased to experience some positive signals. In Australia, a rate increase took place, which was one of the main reasons for the optimism of the investors. Another important factor was the fact that on Monday, business confidence in the U.S. services sector was higher than expected. This way, the European Fellowships will continue following the positive line of Wall Street and Asia.

Virginie Bohez

MBA’s also feel the crisis

In America, the cost of receiving business education (specially MBA’s) has grown increasingly, but is it still worth the money?
The costs of receiving an MBA has increased from $54.000 (when we adjust inflation $69.000) over $92.000 now, ten years later. But what we shouldn’t forget is that not only the price of studying is improved, but also the providing has grown. On top of that, schools became more popular, so they now can choose the very best out of a mass students, who are mostly already high earners. It will take a long period if we want to see if the MBA’s are worth their price, but students can now examine successful alumni, and choose for themselves if it’s overpriced or not.

Leonie Defauw

The Belgian Economy back on track?

After the financial crisis, the Belgium banks finally start to recover. It is very important that the Belgian economy get’s back on track. We can easily notice that the economy is doing better, thanks to the consumption that people do. They don’t hamster their money like they used to do 5-6 months ago.

Marie-Laure De Breuck

How would you regulate the bank of tomorrow?

People who are concerned about the future of banking can change the financial landscape forever! An essay contest launched by The International Centre for Financial Regulation gives regular people the opportunity to give their thoughts on banking regulation. So far, the debate has been dominated largely by politicians, regulators and industry groups. This effort to broaden the debate can throw a new light upon the topic of banking regulation.

Matthias Azou

KBC daughter Centea rejected to succeed restructuring plan?

Every financial institution that obtained financial help during the current crisis is forced to succeed the resturing plan of the European Commission. KBC that is forced to restructure needs to divest drastically and KBC daughter Centea could be "the" convincing element required to succeed the restructuring plan of the European Commission. The divestment of Centea is not the only one, but it's the only core activity that is propably divested. KBC hopes that this proves that they are prepared to make some sacrifices and to become again a stable financial institution.

stijn verwaeren

Less money for charity causes because of the crisis

Almost half of the charity causes are expecting a decrease in their resources because of the crisis. The funds are touched by the falling stock markets, while consumers are cutting in their expences for charity funds. Even if after a bad year in 2008 the stock markets are growing again, the funds still expect a few bad years to come. And half of those funds are expecting subsidiaries.

Marion Caeymaex

Iceland passes criticism on the IMF, UK and Netherlands

The prime minister of Iceland Johanna Sigurdardottir passes criticism on the International Monetary Fund, the UK and the Netherlands because they prevent the reconstruction of the Icelandic economy.

Sigurdardottir finds it unacceptable that the IMF has slowed down her review for months, which was necessarily to get access to additional devices. The Icesave-problem, a conflict between Iceland, the UK and the Netherlands considering almost 4 billion dollar on Icesave accounts, is the reason of the retardation of the IMF. The prime minister hopes that the IMF will start her review in the coming weeks.

Kasper De keersmaecker

Managing your money

When you're young, you only care about having fun but that costs a lot of money, so many young adults end up having debts.
They often don't realize how much money they actually have, how much they spend, what their real needs are, and what they just want to have because it's cool.
There is a solution to this problem and it's called budgeting, although it is not something that they will learn in one day, it can be very helpfull.
Budgeting gives people a goal to reach within a period, so it makes you realize that saving money can also be fun.

Stéphanie De Cleene

The reform of financial monitoring goes further than expected

The government is working on creating new and more severe rules to prevent the chaos of the latest bank crisis: rules that show more respect for the shareholders. The newly-created emergency law for the banks, that includes the possibility of the temporary overtake by the government, should make sure that future financial crises can be solved more effectively and much faster than before.
The next step is the establishment of the ‘Committee for System Risks’ who should control bank-strategies. This new Committee will have exclusive powers. For example, it will have the right to block strategic decisions and they can create an administrative court that will be able to sanction the break of the new law.

Jana Clinck

Prepaid, but Not Prepared for Debit Card Fees

‘It is simplicity itself’, would say Mr. Sherlock Holmes. If you cannot open a bank account, just buy a debit card which is ready for A.T.M. withdrawals, store purchases and online shopping: no credit check, safer than cash. Prepaid debit card is a plastic worth $25, $100 and even $500 you could compare to prepaid phone cards and gift cards for retailers. But you must watch out for the so-called fine print or otherwise you will be really surprised that activating of your account will be already charged with $10 and every purchase will cost you 50 cents more.

Ksenia Charauko
October 6, 2009

House proud?

Property prices are still crumbling in most countries, but there are some reasons for cheer

The economic crisis caused a median house-price decline of 7%, this concluded the IMF who compared house price before and after the crisis.
Some countries suffer more from the crisis, for example Latvia who experienced an annual decline of 60% after the crisis and Estonia experienced collapses of almost 40%.

Still hope isn't lost, because according to The Economist's house-price index some countries have house prices who are high compared to historical standards.
The IMF was unable to give an answer on how much further prices will decrease because it varies in each country but they concluded that a sharp recovery is not likely to happen.

More flexible bank system

Banks all over the world want a larger separation between commercial banks and their investment-banking divisions; only Japan pursues a contrary policy. The reform of the Japanese bank system implies that different departments can interact with each other to preserve the overview. The reform must ensure that the employees can work more easily, moreover their efficiency must improve. The reforms purpose is to introduce more sophisticated financial products on the Japanese market.

Torrino Debal

‘Gandhian banking’ to solve the crisis

Sonia Gandhi is probably chuckling now because she was by far the only prime minister who really believed Keynes's predictions (in stable economical times 40 years ago).
Keynes said that if the government doesn’t interfere, the market will terribly go wrong!
Considering the crisis that we have to face right now, nationalizing the Indian banks was a very wise decision.
Gandhi; with such a name, you can’t possibly do anything bad…

Carl Dejonghe

The hamster-wheel in China

The last years there has been a thrift in China, a surplus has been created thanks to the spending and saving behaviour of the Chinese...

On the one hand China, a surplus country, has to expand more to compensate the deficits of the countries that are levelling down because they spent too much to keep fully employed; but on the other hand the Chinese have to save and they really do.

China's industry has actually become too heavy these days, the Chinese consumption accounts for only a small part of GDP because the household incomes have fallen and a large part of it has flown to capital as profits.

Reasons why China saves, are the education and health care that they have to pay and their dislike of borrowing, but the real increase in thrift is due to the savings by companies; they reinvest the savings so that profits stay high as a share of national income; we call it: the hamster-wheel, a cycle of high investment and high thrift in China that unbalances the economy...

Justine De Kinder

African Wealth and African Style glamorously combined…

Africa does not bring to mind an image of a woman with perfectly manicured nails flipping through glossy magazines in search of the latest handbag or celebrity haircut… Yet such women are there, and in far greater numbers than the news media’s portrayal of Africa might suggest. In the past, African women relied on international fashion magazines for style and beauty information, but nowadays series of new glossies that put an African spin on fashion have arrived. Although the idea of an African magazine is financially risky and unusual –because of the European competition –, most statistics belief the real potential.

Frauke De Temmerman

http://www.nytimes.com/2009/10/05/business/media/05magazine.html?ref=business

Vlerick Management school feels the good influences of the financial crisis.

Banking & Finance

Vlerick Management school feels the good influences of the financial crisis.

Some people can't imagine, but the financial crisis also have positive influences, and the Vlerick Leuven Ghent Management School only confirm that. This year, the school noticed a doubling of registrations for a Master of Business Administration (MBA). In times of crisis, being innovative is very important, so maybe that’s the reason why managers don’t care giving up one year of their career to study at Vlerick and learn new innovative theories. Most of the managers even want to pay the study from their own pocket, which is not that simple with a 24.500 euro fee.

Danis Annelies

The Keynes comeback

Keynes’s intellectual framework, where he describes a world in which pervasive uncertainty leads to persistently inadequate demand, seems more relevant in the last months than at any time since the 1930s. Keynes’s disciples are convinced of the fact that we should use this intellectual framework as an instrument for understanding and fighting the difficult economic situation we are facing today. thanks to Amazon.co.uk we are given the opportunity to buy three books written by three highly regarded Keynes devotees. In these books we are given a closer look to Keynes' insights and possibilities on how we should adjust his ideas to a more up-to-date version so that we are able to administer the intellectual framework in the economic circumstances as we know it today.

Dieter Saey - Van Peteghem
http://www.economist.com/books/displayStory.cfm?story_id=14539560#

Banking & Finance

How to manage your money as a student? 

In August, a poll found that many parents don't know how big the debts of their children are, after graduating from university. The poll also revealed that three quarters of the parents have the confidence that their student spend money effectively, but the student says he would prefer more help with managing money. For this, students can go to a bank with or without their parents and inform about how to manage their money. So after graduating from university, the chance to have big dues of £5,000- £20,000 is rather small. 

Chloé Deconinck

Fat tax

The American congress is considering a tax on sugary drinks and even on junk food to help pay for the planned expansion of health-care coverage. The current total medical costs of obesity surpass $200 billion a year in America and when health-care costs are shared, obesity becomes a burden for everyone. But with this fat tax, even a 10% increase in the price of calories results in a fall in Body-mass index of 1 to 2 points. Which will eliminate half of the observed increase in obesity in America since 1980.

Withdrawals in self-banks

The number of withdrawals in self-banks by non-clients has tripled over the last two years. In the most powerful banks in this country, such as Dexia, KBC, ING and Fortis, there has been an increase from 16 to 55 million. On the other hand, the smaller banks have done better with a rise from 18 to 64 million. This information was provided the Belgian minister of finance, Didier Reynders.

Colette Baele

Banking & Finance

International bank tax…

The G20, Group of Twenty nations, is asking the IMF for a compensation for the ‘damaging costs’ of the financial crisis. That is why Dominique Strauss-Kahn, managing director of the IMF, revealed that the IMF will be looking at proposals. Immediately a levy on banks, for example an internationally agreed tax on the world’s banks, seemed appropriate for MR Strauss-Kahn. Whit this tax money the IMF could help the low-income countries or finance the deposit insurance.

Van Schoors Pieter

http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article6858334.ece

Recessions shake things up rather than slowing them down ...

Although recessions are often associated with shocking consequences, it is important to notice that crises also create opportunities for some companies. Those entrepreneurs who dare to start up or innovate and invest during these ‘difficult times’ are often rewarded while others suffer serious problems. This phenomenon, called ‘creative destruction’ by Joseph Schumpeter, means that old ways of doing things are replaced by new ones in times of recession. Until now it looks like all of this will be confirmed by the current recession.

Michiel De Meyere

Keylogging: the key to your money

Nowadays a lot of people tend to arrange their finances using online banking, which includes taking the risk of online theft, because as we all know: where there is money, there are fraudsters.

And the fraudsters keep surprising us, especially with their new kind of fraud software called Keylogging. Keylogging is a very ingenious device which tracks keystrokes on a computer in order to gather passwords and credit card numbers.

But no need to panic: just keep your anti-virus software up to date and your eyes open!

Bossuyt Maud

It’s all about expectations and figures

Last week the market ended in the red because the expectations in America about unemployment were worser than expected. Today the market ended in the green because… the figures were better!! So if you want to earn money look at the expectations and figures and just be at the right moment, at the right place. But be warned it can change fast!!

Carmen Delalleau

British households' squirreling has reduced

As the crisis is a period of uncertainty about what will happen in the future, British people began to save their money more and more.
Although this is a normal behaviour for an individual consumer, this way to conduct isn't harmless to global consumers. Fortunately, statistics prove the squirreling has reached its peak. This means British people have more faith in the future, which evolves in more spendings and helps to create a revival of the economy.


Sebastiaan Bonte

Changed economic power relations

One of the impacts of the crisis is that US economic power is declining, while emerging economies like China and Brazil have grown. It means that there is a long-term rebalancing of the world economy. Mr Zoellick, head of the World Bank, said “ A Multi-polar economy less reliant on the US consumer will be a more stable world economy”. He said that before the meetings of the World Bank and International Monetary Fund.
What will Europe do? Stand by and watch the US forge partnerships with Brazil and China or even India to ensure their position? Or act pro-actively and become as important as the American economic power and be a match for the emerging economies in the years to come. An interesting topic to follow.


Emmanuel Demyttenaere

http://news.bbc.co.uk/2/hi/business/8289302.stm

Pheasants are gaining by the crisis

This autumn, a lot of pheasants will be saved from a cruel death, as the crisis made hunting become a too expensive hobby for a lot of Britains. The number of entries this year has fallen down by 20 to 30 % and 60 % of the companies who organize these pheasant hunts, are expecting a much lower yield than previous years. The price to go hunting one day has dropped enormously, from 10000 or 20000 pounds to 5000 pounds. Normally 300 to 400 pheasants get shot every year by hunters, this year this will be around 150 of them, what will happen with the rest of them is not known, but it’s not sure that they are left alive in peace.

Julie Deleine

The dog that didn't bark

A revolution is required in the financial regulatory framework in order that better incentives can be given to policymakers. The biggest problem of the present system is the time inconsistency so that authorities tend to support the market when the crisis strikes although they were planning to encourage responsible financial behavior through a no-bail-out policy. Moreover selfish incentives of financial supervisors also hinder the efficient control of the banking sector. To solve the problems it’s suggested to raise rewards and reputation of the public sector and set up supranational institutions for financial regulation.

Cao Xi