Negative Blogs

BMW plans to build two new Mini models at its plant near Oxford in southern England, in a vote of confidence for UK manufacturing and a significant boost for the hard-pressed motor industry.

Norbert Reithofer, BMW’s chief executive, said in an interview with the Financial Times that the move would entail new jobs and investment at the facility, which is operating close to its capacity of 200,000 to 220,000 cars a year.

The German carmaker will unveil “concept” or pre-production versions of a Mini Coupé and a second, as yet undisclosed, car at the Frankfurt motor show this month as it expands its British premium small-car brand.

“I am pleased to announce the Mini Coupé concept car and another new Mini model will both be built at Oxford,” Mr Reithofer said. The Cowley, Oxford, plant employs about 3,500 people and is one of Britain’s largest car factories.

The plans by General Motors to sell control of its European Opel/Vauxhall arm to the Canadian motor supplier Magna International or industrial group RHJ have raised fears for the future of its two UK plants. The Luton plant, which makes commercial vehicles with France’s Renault, is seen by analysts as vulnerable to closure. National Hard Money Association

As times get tough, people look for change. Not just new presidents and prime ministers, but change they can count on — or, at least, count. And they’re willing to turn over couch cushions to find it.

As the financial crisis thrust billion-dollar figures onto the front pages, it also has cast a spotlight on how we perceive and use the smallest of currencies — namely, metal coins.

In Thailand, the Treasury Department has found that coin exchange for paper currency has doubled in the first half of the year. In Argentina, the year began with a drought of coins as people began to hoard pesos.

While most Christmas gift-giving slumped, retailers in the U.S. and the U.K. saw a rise in piggy bank sales — U.K. retailer Debenhams reported a 150 percent increase in sales during the holiday season.

Priya Raghubir is not surprised. As a researcher at New York University, she studies how coins and small denominations of cash alter people’s spending habits — research inspired partly by her son’s delight in getting change after a 7-Eleven purchase on a trip to Hong Kong

“Yet my son refused to cash in a $100 bill he’d been given as a present,” she said. She was curious if the same was true for adults.

Her research suggests, indeed, adults spend like children. She found that if two groups are given an equivalent amount of cash — say a $1 bill versus four quarters, or a $100 bill versus five $20 bills — the latter group will always spend more cash. Hard Money Association

The Australian economy grew by more than expected in the second quarter of 2009, boosted by increases in household consumption and business investment.

The economy expanded by 0.6% in the three months to June from the previous quarter, the government said.

Analysts had forecast growth of 0.2% after a sharp drop in export prices was announced earlier in the week.

The government has announced stimulus measures of 42bn Australian dollars ($35bn; £21bn) in the past year.

Australia is one of the few developed countries to have avoided falling into a recession.

Adam Carr, chief economist at ICAP, called the results “fantastic”.

“It’s looking like we will be firing on all cylinders in H2 [the second half of the year] and 2010,” he said.

He added that he thought the Reserve Bank would raise interest rates before the end of the the year.

On Tuesday, figures showed Australian export prices in the second quarter had fallen by 15.8% - the largest drop in the 50 years since records began. National Hard Money Association

UK shares have dropped after weak manufacturing data raised concern over the viability of the economic recovery.

The latest survey from the Chartered Institute of Purchasing & Supply (CIPS) indicated that UK manufacturing activity fell in August.

Other data also showed that net lending to individuals dropped at its sharpest rate since 1993.

The FTSE 100 fell 60.85 points to 4,845.05. Last week, the index had hit its highest level since October 2008.

The recent rise in the market had been triggered by renewed optimism of the health of the UK economy and better signals from abroad.

But the latest CIPS survey showed its headline measure of manufacturing activity fell to 49.7 in August, where a figure below 50 implies contraction. NHMA

The French trader accused of a multi-billion-dollar fraud at banking giant Societe Generale will go on trial next year, a lawyer for the bank said Tuesday.

Jerome Kerviel will face charges including forgery, breach of trust, and introducing fraudulent data into the bank’s data system, Societe Generale lawyer Jean Veil told CNN.

He faces a penalty of up to five years in prison and a fine of up to €375,000 euros ($538,000), Veil said. The bank also will ask that Kerviel reimburse them for almost 5 billion euros ($7.1 billion), “which probably he will not pay,” Veil said.

The trial is expected to start in the first half of 2010, perhaps in May or June, Veil said. It will take place at the Tribunal de Grande Instance in Paris, he said.

Kerviel, who is now free on bail, was arrested last year after Societe Generale unveiled trading losses of more than $7.2 billion. The bank attributed the losses to fraud by Kerviel, who traded European index futures for the bank.

Kerviel is the only one charged in the case. His assistant, Thomas Mougard, was cleared of charges Monday, Veil said.

Societe Generale believes Kerviel alone was responsible for the losses, which the bank announced in January 2008. Kerviel maintains he was not acting alone, Veil said. National Hard Money Association Conference

Entertainment giant Walt Disney is to buy Marvel Entertainment in a shares and cash deal valued at $4bn (£2.5bn).

The deal means Disney will take over ownership of 5,000 Marvel characters, such as Spider-Man and the X-Men.

Marvel shareholders will get $30 per share in cash plus 0.745 Disney shares for every Marvel share owned.

The boards of Disney and Marvel have both approved the deal, which now needs the backing of Marvel shareholders and competition authorities.

Last month, Walt Disney reported a fall in profits of more than a quarter as the downturn hit revenue at its film and theme park divisions.

Net profit between April and June came in at $954m (£579m), down 26% on the $1.28bn the entertainment giant made in the same period last year.

Revenues of $8.6bn were down 7% from the $9.2bn recorded a year before. Hard Money Association

Apple’s iPhone is set to make its debut in China by the end of this year after the US company reached agreement with China Unicom, the country’s second-largest mobile operator.

China Unicom on Friday said it would start selling the 3G iPhone in the fourth quarter after signing a non-exclusive three-year contract with Apple.

The company said it would not use Apple’s traditional revenue-sharing model and would instead pay the group on a wholesale basis.

China Unicom said it hoped the introduction of the iPhone would boost falling profitability.

The company said on Friday that first-half net profit fell 42.1 per cent to Rmb6.62bn ($969m) amid heated competition, while revenues dropped 4.3 per cent to Rmb74.51bn.

Chang Xiaobing, chairman and chief executive, said he expected iPhones to lure more high-end users who spend more on data services. National Hard Money Association

The Icelandic parliament has voted in favour of repaying more than $5bn (£3bn) to the governments of the UK and the Netherlands.

The so-called Icesave bill will reimburse funds paid by the governments to compensate those who lost money in the Icelandic online bank Icesave.

About 400,000 savers lost money when parent company Landsbanki collapsed last year.

The amendments will now have to be agreed by the UK and the Netherlands.

The deal was agreed in June, but was only passed after an amendment was added setting various limits to the payments. NHMA

Bankers, industrialists and London’s mayor have fiercely rejected Lord Turner’s argument that Britain’s “swollen” banking industry was destabilising the economy and needed to be cut down to size.

The backlash came a day after the chairman of the Financial Services Authority said the City watchdog should be “very, very wary of seeing the competitiveness of London as a major aim”.

He also floated the idea of higher capital reserve requirements and a global Tobin tax on financial transactions to choke off some of the banks’ “socially useless” activity.

Lord Turner’s critics said he had overstepped his remit as a regulator and risked damaging London’s standing as Europe’s leading financial centre.

Stuart Fraser, chairman of policy at the City of London Corporation, said Lord Turner was playing into the hands of rival financial capitals, such as Frankfurt or Paris. “Other centres would dearly love to have business from London. If we want to shoot ourselves in the foot, they would be delighted to take the business,” he said.

Boris Johnson, the London mayor, said anybody who did not believe the FSA’s responsibilities included protecting the international competitiveness of the City was “crackers”. National Hard Money Association Conference

The US economy shrank at an annual pace of 1% between April and June, unchanged from an initial estimate released last month, according to the latest data.

Analysts had been expecting a downward revision, with some forecasting a contraction of 1.5%.

The second quarter figures were a significant improvement on the 6.4% contraction between January and March.

US growth figures are revised frequently and the different estimates can vary significantly. Hard Money Association