Thursday, October 30, 2008

Ross & Brand saga ousts serious news


For the fourth day running the top story on the BBC and Sky News was the furore surrounding a lewd broadcast featuring Jonathon Ross and Russell Brand [timeline]. Each day this week the drama has been beefed up by the tabloids, radio chat shows and TV News broadcasts. Even broadsheets have covered the story prominently on their front pages. The issue surrounds an offensive phone call that was made to actor Andrew Sachs, well known for his role as Manuel in the 1970s sitcom Fawlty Towers. Sachs was not in at the time of the call and a message was left on his answer machine. During the banter Ross was heard to say “He [Brand] fucked your grand-daughter”. A follow up call added to the lewd comments [transcript].
A producer contacted Sachs and it had been agreed that a proper interview be conducted. However, the taped programme was aired and some days later, following greater publicity in the Mail on Sunday, thousands of complaints began to flood into the BBC. The organisation said it apologised and said it had launched an investigation. Brand made what was seen as an “apology for an apology” [BBC] on Monday and the Venessa show on BBC London received dozens of calls calling for both he and Ross to be sacked. Questions in parliament were raised and much air time was given over to the story on Sky and the BBC. Yesterday Russell Brand said he was resigning from the BBC radio programme and repeated his apology to Andrew Sachs and his grand-daughter Georgina Baillie [BBC].
As news broke tonight that Leslie Douglas, the controller of BBC Radio 2, had resigned the rolling news started once again on the two main UK news stations. It was also announced tonight that Jonathon Ross would be suspended without pay for 12 weeks [BBC / Sky News]. Mark Thompson the BBC controller described Ross’s actions as "utterly unacceptable" and that "it cannot be allowed to go uncensured or without sanction". Although there are some serious issues about taste and decency surrounding the story, many have complained at the saturation coverage [Sky News].

Although other stories have been covered by the media, many have been shuffled to the back pages of the papers or given very little airtime on television news. Only CNN and al Jazeera continued to report the important stories. The earthquake in Pakistan, which has left more than 200 dead, barely got a mention on either of the two news broadcasters yesterday [CNN / al Jazeera. Both CNN and al Jazeera gave reports of a bomb blast in India which killed 62. Again Sky gave only a few seconds to the incident. While the BBC and Sky News have reported on the continuing crisis in the Congo, which has left 50,000 displaced, it has only been CNN and al Jazeera that has provided in depth coverage and analysis. Even a more local story, that of a bomb blast in Spain which injured 27, failed to make it to news bulletins on either Sky or the BBC [CNN]. And while bomb attacks maybe commonplace in Afghanistan, a suicide attack on the Afghan Ministry in Kabul which left 5 dead was only mentioned on al Jazeera and on a rolling strap on CNN.
When the BBC and Sky have returned to other news it has been to cover the US election. To flip between the two stations one might think the election was here. More than 45 minutes of continual coverage were given over to events in the US mid-afternoon on Thursday. Sky and BBC both gave significant airtime to Obama as he spoke at a rally in Florida. And Sky are presenting several special programmes covering the election.
Financial news has also been pushed to the back burner. Stocks across most indices continued to rise despite falls seen on Monday. However, in Japan, which is also seeing financial difficulties, the government initiated a bail-out to the tune of $250 M. However despite the economic gloom, the biggest shopping mall in Europe opened today in west London [BBC]. Maybe normality will return as everybody goes shopping. News may also become a little more serious as the Ross & Brand debacle winds up.

Wednesday, October 29, 2008

UK - Man shot dead by London police


Armed police at the scene

Police have shot dead a man in east London. Witnesses said they saw a man with a gun and police from the Metropolitan Police’s armed division CO19 were dispatched to the scene. Reports suggest the shooting followed a domestic incident at a nearby McDonalds, however this is unconfirmed. As well as armed officers dozens of other police units were sent to the scene near Romford, Essex and a police helicopter hovered overhead. He is said to have pointed a firearmat paramedics before police opened fire. The shot man was taken to nearby Queens Hospital where he was pronounced dead. Three weapons were recovered from the scene according to police. A woman is also said to have been injured though it is unclear how she received her injuries. She is not thought to be in a life threatening condition. The Independent Police Complaints Commission have been informed about the incident which occurred at around 13:40 GMT [BBC / Sky News].

US paper declares Obama victory


A newspaper in the United States has hedged its bets and declared Barack Obama the winner of next weeks election. The weekly New Mexico Sun News [PDF] ran with the headline “Obama Wins!” over a picture of the Democratic presidential candidate in front of the White House. In the self declared ‘Special Collector’s Edition’, the paper says it based its headline on “extensive research, , including but not limited to, the numerous newspaper endorsements..., “gut-feelings”, and the need for the American people to have closure and certainty about something in their lives”. In an attempt to elevate the paper above other media and be first in declaring the winner, “The New Mexico Sun News hereby claims that achievement” the paper said [BBC / LA Times].
The “bold” move by the newspaper will no doubt be criticised by McCain supporters, and the Republican candidate himself who has already accused Obama of “already measuring the drapes [curtains]” at the White House. It has been an unusual election campaign, punctuated by bizarre and quirky moments, as well as the serious arguments and debates. And the debates will continue up and until the 4th of November.
Tonight, Barack Obama is taking over the airwaves on nearly every television station in the US for an unprecedented half hour broadcast. The party political broadcast won‘t quite go out on every channel after ABC pulled out of the deal. Walt Disney Co. owned ABC initially balked at selling its 20:00 slot, saying it didn't want to pull its regularly scheduled series, "Pushing Daisies," even though the show has been losing viewers. It is costing the Obama campaign $1 million to buy a slot on each of the networks that have made the deal. NBC, MSNBC, Fox, Univision and CBS will all broadcast the programme at 20:00 EDT on Wednesday night. Fox are having to reschedule the World Series Game 6 to 20:35, a condition that was approved by Major League Baseball, but is likely to upset some sports fans. CNN rejected the commercial offer saying in a statement, "We did not want to pre-empt our programing lineup with a 30-minute spot. We'd rather use our air to continue to cover the campaign, candidates and issues like we always do from all points of view with the best political team on television". The news channel said the advertisement would be covered in news bulletins however. "CNN will cover it as a news story, just like we do with all the other campaign ads" a spokesman said. Fox News said they had not been approached to broadcast the half hour 'infomercial', as it's been dubbed. The Republicans can little afford such luxuries but McCain will feature on CNN’s Larry King Live soon after the broadcast. Obama will meanwhile be appearing on the Daily Show, which will be aired in the UK on Thursday night [Sky News / BBC].

Tuesday, October 28, 2008

China's food scandal hits eggs


China has once again fallen under the spotlight for all the wrong reasons. In what may come of little surprise to many, another food crisis has gripped the country. Following the much publicised milk scandal, China is now reeling from the revelation that eggs have been found with unacceptably high levels of melamine, the same substance found in a number of milk products. The level of melamine found in the eggs was 4.7 mg per kg. Melamine found in food meant for children under three and lactating mothers should be no higher than one mg per kg according to some experts, though ideally there should be no such contamination.

It is not clear how the melamine found its way into the eggs, but it has been suggested that chicken feed had been contaminated. Melamine has often been illegally added to products to boost perceived protein levels and the latest incident may have wider implications. If animal feed has been tainted with the chemical, then meat, fish and other derivatives may also be under scrutiny. It is a problem which Chinese authorities have failed to properly address despite several high profile incidents. On March 15th 2007, the FDA in the US learned that certain pet foods were sickening and killing cats and dogs. The FDA found contaminants in vegetable proteins imported into the United States from China and used as ingredients in pet food. But even then it was not only pets that were identified as being at risk. A portion of the tainted pet food was used to produce farm animal feed and fish feed. FDA and the U.S. Department of Agriculture discovered that some animals that ate the tainted feed had been processed into human food. Although risks were deemed to be ‘low’ according to the FDA, an investigation was mounted and on February 6th 2008 the FDA announced that two Chinese nationals and the businesses they operated, along with a U.S. company and its president and chief executive officer, were indicted by a federal grand jury for their roles in a scheme to import products purported to be wheat gluten into the United States that were contaminated with melamine [FDA].

So despite the warnings, China and food inspection authorities outside the country have continually failed the consumer in testing food and making sure it was fit for consumption. The effects have widespread implications. Beyond the health implications, the ‘Made in China’ brand has been sullied further resulting in loss of sales. This in turn has closed factories in China and added to the unemployment lines. White Rabbit, the once popular milk candy hopped back onto the shelves in mid-October, but it remains to be seen if consumer confidence will return [Xinhua]. On an Internet bulletin board a one-time fan of the confectionery writes, “If we eat the white rabbit candy, we’ll be the lab rats” [WSJ]. Others spoke of their general distrust of all milk products. “I have stopped drinking milk, let alone creamy candies. I might start buying them months from now when everything subsides. I've loved them since my childhood. But no White Rabbit any time soon” said Ni Yuezhen, 56, outside a Shanghai store where the candy was re-launched. Another was even more scathing. “I bought quite a few White Rabbit candies for guests ... but they are useless” said a shopper who only gave her surname as Wang. “I shall never buy the candies again” she murmured, pushing past salesgirls in yellow hats and matching miniskirts who were handing out candies at the store's entrance. An ex-patriot spoke to tvnewswatch expressing her sadness at the possible demise. “It’s very sad” Ms Wang said. “I remember eating them as a child. But now who’s going to trust them?” There is much to be concerned about. Four Chinese babies died of kidney failure and more than 53,000 fell ill this year after consuming tainted dairy products; and nearly 4,000 young children remain in hospital. And only last week it was revealed that 1,500 dogs had been killed by melamine contaminated feed [CNN].

The food scares will hit both companies and their workers hard. Wal-mart has already pulled eggs from their shelves in China [CNN] and others are likely to follow. Only one brand of eggs, Kekeda, produced by the Hanwei Group, has so far been implicated in the latest scandal but it is sure to worry other producers [CNN]. Eggs are used in a wide selection of products, from cakes, biscuits, pastries and confectionery. And many of these may be exported giving rise to concerns abroad. Exported green beans which sickened several people in Japan recently were found to be heavily contaminated with pesticides [CNN].

The issue has worried Chinese authorities but despite announcements by Premier Wen to clean up the food industry, scepticism remains. “We will improve legislation in food safety” Wen said during a 43-nation Asia-Europe Meeting summit on Saturday. The state-run China Daily newspaper said the law will impose safety standards on food additives and ban all harmful chemicals. It will also allow the government to recall unsafe food if companies fail to do so. But the World Health Organisation says China needs to go much further [CNN / BBC].

China has been swept by a series of food and product safety scandals involving dozens of different products. They include dangerous and lead contaminated toys, fake drugs, unsafe tyres, toothpaste containing diethylene glycol [engine coolant], melamine tainted pet food, fish and prawn containing banned fungicides and antibiotics, pesticide contaminated beans and dumplings, and defective baby cribs.

Fears amongst consumers already exists in the West [BBC] and both the Chinese government as well as any foreign companies operating in the country must endeavour to improve product and food safety before the ‘Made in China’ label becomes irreparable. But maybe it is already too late.

On CCTV-9’s Asia Today there was no mention of the latest food scare. Instead there was a focus on attempts by Bangladesh to clean up street food with new hygiene standards being rolled out across towns and cities. China Today focused on Japan’s recent food scare surrounding Nissin’s Cup Noodle which made one woman ill. Focusing on problems elsewhere and ignoring domestic problems is unlikely to bring about a solution. In fact the reports on CCTV were generally upbeat saying that China would see stable exports. Despite more than 50% of toy factories having closed in 2008, one toy trader spoke of strong confidence in the industry. China needs to do more than open up to the world. It needs to open its eyes and see what’s really going on; and acknowledge it.

Monday, October 27, 2008

Men arrested in Obama assassination plot


Police in Tennessee have arrested two men in a plot to kill Democratic presidential candidate Barack Obama, Sky Newshas reported. According to US authorities the men, described as neo-nazi skinheads, planned to go on a killing spree aimed at shooting and decapitating up to 102 blacks with Obama listed as a final target. US correspondent Ian Woods said, "It is not necessarily a credible threat to the senator's life. But eight days before an election, clearly something like this will be taken very seriously." No other channel has yet reported the story in the UK.

Honey bees may sting world markets


Financial markets have continued their roller-coaster ride despite bank bail outs and cash injections [CNN]. Though the slump in stocks and currency market uncertainty has failed to make the same headlines seen a few weeks ago, the last two weeks has not brought the stability expected by some analysts. Last week the Dow fell by 500 points on one day alone and in Japan the Nikkei fell sharply on Monday’s trading falling to its lowest in 26 years. Asia has seen some of the worst falls with fears of a global recession. The Nikkei closed on Monday 6.36% down while the Hong Kong Hang Seng dropped 12.7%. The Seoul Kospi was one of few making gains, finishing 0.82% up on the days trade. Currency trading has partly resulted in the Japanese Yen rising to record levels. Low interest rates on borrowing the Japanese Yen has resulted in a rise hitting a 13 year high. But in Europe the Euro and Pound have both lost value. The European markets have also fared little better. The FTSE has dropped around 1% in the first half of Monday, while the CAC and DAX have fallen by 2%. The Nasdaq has reflected the uncertainty in the global tech markets falling 1.75% in Monday’s early trading. Last week the index fell 9.3% and has lost 32% of its value since mid-September following the demise of Lehman Bros. All the uncertainty in production has resulted in further falls in the price of oil which dropped below $60 per barrel, a 17 year low [CNN].

But it’s not just consumables that are affected in this bear market. The demise of the humble honey bee may have a bigger impact than many might think. More than 25% of food is pollinated by bees and the drop in bee numbers may create widespread problems in the agricultural industry. The honey bee is under threat from the varroa_mite which latches onto bees and sucks their "blood". But the reduction of numbers will not only have effects on the ecology of the countryside [BBC] it will also result in the loss of a popular product on supermarket shelves. Robin Oakley, reporting on CNN, says domestic honey may disappear from Britain’s shops within a few months [Daily Telegraph]. And the drop in bee numbers isn’t only confined to the UK. In Israel honey production has fallen by 60%. In North America the fruit growing areas of California and Florida have been especially hard hit by so-called colony collapse disorder. And the loss of the insect is no laughing matter. Bees pollinate an estimated 90% of the apple crop, 30% of the pear crop and much of the soft fruits such as strawberry and raspberry. "We need beehives in orchards because we rely on honeybees to pollinate apple blossom in Spring," says Martin Ridler, Orchard Controller for Gaymers Cider. "You can hope for insects and the wind to help, but honeybees guarantee pollination". A century ago there were more than one million bee hives. Numbers fell to half a million in the 1950s before reaching the current level of 240,000. If the numbers continue to fall it could affect a British apple industry worth more than £165 million. The demise of the humble bee will have more than a sting in the tail for world food markets. Some have predicted an even worse outcome. According to Albert Einstein, our very existence is inextricably linked to bees - he is reputed to have said, "If the bee disappears off the surface of the globe, then man would only have four years of life left" [Guardian].

Sunday, October 26, 2008

War of words as US election nears


With nine days to go until America votes, a war of words is being waged between the two main candidates. Obama criticised his opponent, John McCain, of a negative campaign consisting of “ugly phone calls, the misleading mail and TV ads, the careless, outrageous comments”. McCain meanwhile accused Obama as preparing for an election win before the votes were cast, something the Obama camp has virulently denied. “Senator Obama's inaugural address is already written,” Mr McCain said, “I'm not making it up. A lot of voters are undecided but he's decided for them”. The Republican went on to say “What America needs now is someone who will finish the race before starting the victory lap”. But aside of the up beat rhetoric from John McCain the polls continue to show Barack Obama in the lead. The BBC show him at least 6% ahead of the Republicans and other polls give even stronger leads.

And for the Republicans it has not been a good week. Television news reports have continued to make light of gaffes uttered by John McCain. In one he ‘miss-spoke’ during a rally in Pennsylvania. "You know, I think you may have noticed that Senator Obama's supporters have been saying some pretty nasty things about Western Pennsylvania lately," McCain told the audience in the town of Moon Township. But then came the slip up when he said, “I could agree with them more”. He should have, of course, said less. But the faux pas resulted in several comedy programmes making light of McCain’s inability to string a sentence together. In Britain, Have I Got News For You played out the clip and the Daily Show in the US, which is also aired in Britain, made much capital from the clip [You Tube / Huffington Post]. McCain had been referring to a comment made by John Murtha who had suggested there were many racists in Pennsylvania [You Tube]. However, no-one can deny that race is not an issue in the 2008 election. It may not be discussed as readily as here in the UK, but the issue of a black president may not sit well with certain proportions of America.

Another issue that has come to the fore in recent days is the so-called ‘real America’ that Sarah Palin has described in several addresses. Democrats and others have criticized Palin for seeming to imply that some parts of the country were more patriotic than others. The Daily Show made particular capital from her comments suggesting that through inference other parts of the country could be regarded as ‘fake America’. To a crowd in North Carolina, Palin said “We believe that the best of America is in these small towns that we get to visit, and in these wonderful little pockets of what I call the real America, being here with all of you hard-working, very patriotic, very pro-America areas of this great nation”.

The barrage of criticism has prompted Palin to apologize on an interview with CNN.
But the gaffes did not only come from the Republicans. Last week, Obama’s running mate Joe Biden seemed to indicate the Democratic Presidential candidate had little experience for dealing with international issues. He was quoted as saying, “Mark my words: It will not be six months before the world tests Barack Obama like they did John Kennedy”. They were comments that the Republicans immediately seized upon despite Obama declaring “Joe sometimes engages in rhetorical flourishes”.

For British viewers, it is a continuing soap opera. From political gaffes to miss-spoken speeches it hat has been a roller-coaster ride of laughs for many viewers. Have I Got News for You has made much mirth from both Palin [You Tube] and McCain [You Tube]]. And little has escaped those who seek to criticise the candidates and their running mates. While Obama has been berated over his possible taxation policies, Sarah Palin was under fire for apparently spending $150,000 on clothes, though it was something she denied [Daily Telegraph]. And with arguments over Joe the Plumber, and whether he needs or doesn’t need a licence [MSNBC], the whole election debate has almost descended into farce [Daily Show]. Although the election has had its moments, from the candidate race through to the presidential debates, there are many here in the UK who will be glad when it’s all over.
[Election coverage - BBC / Sky News / Daily Telegraph / The Times]

UK - Heavy rain strands runners


Heavy rain has swept across much of Britain causing problems for motorists in many areas. But the worst conditions hit runners taking part in a mountain marathon in Cumbria; north-west England. Some 2,500 people were taking part in the race before it was called off on Saturday due to bad weather; and as the heavy rain set in many found themselves stranded. An RAF helicopter was called in to search for missing competitors and latest reports suggest that 44 people were still unaccounted for on Sunday morning. Overnight more than 1,700 people had sought temporary shelter in mines, farm houses or camped out. At least 12 people were taken to hospital suffering from hypothermia and minor injuries according to the Northwest Ambulance service. For those that made it safely back down the mountains many found their vehicles caught in deep flood water. Police have also said that many roads in the area were impassable with floods hitting many areas [BBC / Sky News].
Heavy rain has also brought bad road conditions to many other parts of the UK. There are currently 20 flood warnings in effect according to the Environment Agency with a further 63 flood watches also in effect.
UPDATE [18:00] - All the participants have been accounted for. However Police and rescue services have criticised the organisers for not having cancelled the event earlier [BBC]. The RAF, as well as police and ambulance services, were employed to rescue dozens stranded in appalling conditions at a cost to the taxpayer of thousands of pounds.

Saturday, October 25, 2008

Taiwan - Thousands protest against China


Hundreds of thousands of pro-independence demonstrators have voiced their anger against China on the streets of Taipei. Half a million people, according to the organisers, waved banners denouncing the warming ties to the Chinese mainland. It is the first major demonstration since President Ma Ying-jeou took power in May. He was accused by many demonstrators of not standing up to the Chinese government especially with regards the milk scandal which sickened several people on the island. Some of the demonstrators shouted slogans, “Oppose toxic products, defend sovereignty”. Former President Chen Shui-bian, who quit the pro-independence DPP after money laundering claims against him and his family surfaced earlier this year, joined the march and was met by a cheering crowd [BBC / al Jazeera /
AFP].

Dozens dead in Yemen floods


At least 45 have been killed and thousands have been left homeless after devastating floods swept through Yemen. Heavy rain began to fall on Thursday and continued into Friday and Saturday. It is a country which sees very little rain amounting to only a few centimetres per year. The last such disaster occurred in 2006 when 25 people were killed by floods [al Jazeera / CNN].
Floods have also left at least 13 dead in Morocco following torrential rain described as the worst in 20 years [al Jazeera].

Wednesday, October 22, 2008

India heads to the Moon


Disappointing pictures but a successful launch

The Indian-built launcher carrying a 1.5 tonne satellite blasted off Wednesday morning. The launch went as scheduled from the Satish Dhawan Space Centre in Sriharikota at about 06:52 local time [00:52 GMT]. The probe will circle the moon for two years mapping the surface and collecting data about the lunar poles. The launch vehicle has been successfully employed on 13 previous occasions, but this is India’s first attempt at sending a probe to the moon. Although there is a potential commercial spin-off, there has been much criticism due to the high poverty in India [BBC / isro.org].

The pictures coming Live from India were somewhat disappointing. The initial shot was focused on a close-up of the base of the rocket at ignition. A wider shot followed showing clouds of smoke before cutting to a shot of the sky, the camera desperately searching for the launch vehicle. When another camera finally picked up the rocket streaking into the sky it was only a matter of seconds before it disappeared into clouds. But aside from the poor picture coverage it was a moment of history for India.

Tuesday, October 21, 2008

China names wanted Islamic terrorists


Seven of the eight suspects named by Chinese authorities [Xinhua]

Chinese authorities today made an unprecedented request to international authorities to help them find a number of terror suspects. At a press briefing Wu Heping named eight men said to belong to the East Turkestan Islamic Movement. The men, named as Memetiming Memeti, Emeti Yakuf, Memetituersun Yiming, Xiamisidingaihemaiti Abudumijiti, Aikemilai Wumaierjiang, Yakuf Memeti, Tuersun Toheti and Memetituersun Abuduhalike, were said to be responsible for terrorist plots targeted at the summer Olympic games. They "seriously threatened the security of the Beijing Olympic Games and China's social stability, while at the same time composing a threat to the security and stability of relevant countries and the region" Wu told reporters [Xinhua / BBC / Fox]. During the lead up to the games there were a number of incidents. In Kunming, Yunnan province, two buses were targeted killing 2 people and injuring several others [tvnewswatch], though authorities have consistently denied it was a terrorist attack despite claims by the Turkestan Islamic Party [tvnewswatch / BBC]. And in the Xinjiang Uighur Autonomous region a number of attacks left more than 30 dead [BBC]. One attack alone killed 16 policemen and injured a number of others [BBC].

It is not only separatists in in Xinjiang and Tibet that are causing a headache for Chinese authorities. China is also fighting a constant psychological battle with Taiwan. Many people in the country support independence from China and today a protest boiled over with a Chinese envoy getting shoved to the ground. The attack on Vice Chairman Zhang Mingqing of the Association for Relations Across the Taiwan Strait was shown on television news broadcasts and comes amid improving relations between Beijing and Taipei under the administration of new Taiwanese President Ma Ying-jeou. Protesters shouting “Taiwan does not belong to China” surrounded Zhang and in the mêlée he stumbled to the ground [CNN / BBC].

The China crisis


The Shanghai Composite has lost 3000 points in 2008

China's economic growth rate has fallen for the third quarter in succession, and there are fears that the economy could be heading for a severe downturn. The National Bureau of Statistics said the economy had grown at a rate of 9% in the three months to September, down from 10.1% over the previous quarter [BBC]. Many workers are concerned for there jobs across the continent and thousands have already been made unemployed. More than 50% of toy factories have closed in the last year, partly brought about by a lack of demand, but also due to concerns over safety issues. This has itself brought protests outside factories by disgruntled workers [BBC]. Effects of the credit crunch, which has mainly affected Western banks and financial institutions, is now being felt across many parts of Asia [BBC].

And with China having stretched itself well beyond its borders, there are likely to be many difficulties ahead. The country has invested heavily in many African countries and draws heavily from the continent in natural resources such as copper and oil. But it doesn’t come without risks. In Sudan, 9 oil workers abducted along with their Sudanese drivers. A note was later passed to authorities by the kidnappers demanding that Sudan’s people received a greater share of the country’s oil wealth [BBC]. Dozens of Chinese oil workers have been targeted in the past few years as revolutionary groups call on governments to share the profits amongst the indigenous population. Oil workers in Nigeria have been targeted many times. In 2007 more than 100 foreigners were kidnapped by radical groups amongst them several Chinese nationals [BBC].
Despite the risks and the criticism directed at China by environmental and human rights groups, the Chinese government has not been dissuaded from setting up foreign deals.

In fact this week it was announced that China would help Pakistan build two nuclear power stations. With the continuing political instability in the country, the decision will raise safety concerns especially in Washington [BBC]. Over the last few months Pakistan has gradually drifted away as an ally in the War on Terror. US air strikes near to the Pakistan-Afghan border have not helped matters, and there have been strong words exchanged from both sides. In September there were reports that Pakistani troops had opened fire to prevent US forces from operating inside Pakistan. And after a US drone crashed there were suggestions that Pakistan’s military were responsible, though this was officially denied by both sides [BBC].

Back in China, and the fall out from the milk scandal continues. Thousands of parents are demanding answers and compensation from the Chinese government, and there is anger that authorities failed to act quickly enough to prevent the crisis spiralling out of control [BBC]. Even statements by Premier Wen, who said this week that the government was “partly responsible” for the milk scandal, have failed to placate the parents of sick children [BBC]. Melamine, the substance responsible for killing 4 babies and sickening thousands has previously been found in pet food exported to America. Hundreds of animals fell sick and dozens died. But melamine contamination continues even now. Today it was revealed that 1,500 dogs being bred at a fur farm in Liaoning province had been poisoned with melamine contaminated food [BBC].
Health concerns have prompted new measures aimed at improving medical care across the country. Many critics say that health care in China fails to address the needs of China’s sick. Health reforms were announced by authorities earlier this year [BBC], but the Lancet magazine has suggested the proposals are too little and are not being implemented fast enough. Many cannot gain access to proper health care and those that can are often unable to pay for treatment. Bill Summerskill, the Lancet's executive editor, told the BBC that the current system was not working.
"More than half the money comes out of pocket. And if people end up in hospital, the average hospitalisation is greater than an average person's wage. China is facing a real problem with this new phenomenon of health poverty. Where people either can't afford to get the care or else, having received the care, are then bankrupted by it," Summerskill said [BBC].

Many problems in China are often brought about by corruption and this week saw the latest conviction in China’s attempt to clean up such activity. Liu Zhihua was convicted by a court in Hebei province of taking $1,020,000 (£589,000) in bribes while in charge of building venues for the Olympic Games. The ex-Beijing vice-mayor received a suspended death sentence. A suspended death penalty in China is normally commuted to life imprisonment on condition of good behaviour [BBC]. Reporting on Liu's prosecution was restricted in the months leading up to the Olympics in order to avoid tarnishing the state's image. This despite a relaxation on rules governing the actions of journalists. Last week China announced it was to make permanent the rules governing foreign media. But reporting in China is still difficult despite the relaxed rules [BBC].

But there was one report which was widely reported in China this week. A court in Shanghai rejected the appeal by police killer Yang Jia. He was accused of going on a killing spree, apparently in revenge for maltreatment by police who arrested him on suspicion of stealing a bicycle. Yang Jia launched an attacked on a Shanghai police station throwing a petrol bomb and stabbing several police officers, killing six and injuring four others. Bizarrely the case prompted some to declare Yang Jia a ‘hero’ on some internet forums. Outside court, one member of the public told a Western reporter, "He represents the people's power. And we don't have it" [BBC].

Monday, October 20, 2008

UK - Father spared jail for manslaughter


Gary Cooke who admitted manslaughter of daughter Elizabeth [left]

The father who admitted manslaughter over the death of his daughter has been spared jail. Gary Cooke’s seven year old daughter had been following his Range Rover on a dark country lane riding a quad-bike. But as his daughter Elizabeth drove along the Essex road she was fatally hit by another Range Rover travelling in the opposite direction. The accident happened on Boxing day 2007 near the family home. Handing Cooke a nine month suspended prison sentence at Chelmsford Crown Court, Judge Christopher Ball QC said “I don't suppose I was alone in immediately reacting [to the news of the crash]; What sort of a fool was it that allowed his child out in these circumstances?” He described the act of allowing such a young girl to drive a quad-bike on Britain’s roads as “folly of the highest order” [BBC / Sky News].

Afghanistan - US General calls for more troops


Gen. Craddock: More troops were needed to defeat the Taleban [Sky]

The Taleban have said they targeted a British aid worker because she was “promoting Christianity” in the country. Gayle Williams, who worked for Serve Afghanistan, was shot six times in the back streets of Kabul by assassins riding on a motorcycle. She was the 6th aid worker to die this year in a country that has seen continued violence against foreign workers [BBC / Sky News / CNN]. In August another aid group, the International Rescue Committee, suspended operations after three of its foreign female staff, a British-Canadian, a Canadian and a Trinidadian-American, were shot along with their Afghan driver close to Kabul.

The Taleban have also claimed responsibility for a bomb blast targeted against a German patrol killing 2 German soldiers. Five Afghani children were also killed in the attack some 60 km from Kabul.

The latest attacks came as NATO General John Craddock warned there was a lack of political will to tackle the increasing violence [Sky News]. In an interview with Sky’s International Correspondent Tim Marshall he said "I do not think we are losing, we are not winning fast enough". He said that reconstruction of the country was also moving too slowly. While he refused to be specific, General Craddock said that a number of NATO countries were not forthcoming with the much needed manpower. He and other NATO leaders have said that more troops were needed, not only to defeat the Taleban but also to tackle the war on drugs. Craddock said the British role was extremely important as Helmand province was one of the main poppy growing areas. But, he said it was up to British politicians to make the right decision to deploy the much needed forces. Over 120 British servicemen and women have so far died in the conflict.

Sunday, October 19, 2008

Colin Powell endorses Obama


US President George W Bush's first Secretary of State, Colin Powell, has endorsed Democratic election candidate Barack Obama for the White House. In his statement on NBC's Meet the Press, Powell made clear his reservations of Sarah Palin as McCain's choice as Vice Presidential candidate and of the negative campaigning that has been run by the Republicans. "I'm also troubled by, not what Senator McCain says, but what members of the [Republican] Party say... such things as 'Well, you know that Mr Obama is a Muslim'. Well the correct answer is, 'He's not a Muslim, he's a Christian, he's always been a Christian'. But the really right answer is, "What if he is?' Is there something wrong with being a Muslim in this country? The answer is 'No', that's not America." The story headlined on all the major news channels on Sunday following the announcement which is bound to rattle McCain as the election approaches [BBC / Sky News / CNN] .

Friday, October 17, 2008

China to extend 'media freedoms'


Media were still subject to harassment during the Beijing Games

Media freedoms that were implemented during the Beijing Games were due to be rescinded today. Media reports today on Sky and CNN aired their concern that China might revert to their old ways; restricting movement and implementing rules requiring permission to film in certain locations [BBC / Sky News / BBC] . However despite these fears it has been announced that the reporting freedoms are to become permanent [AP / BBC]. China had been obliged by the IOC to relax the rules covering journalists. However even during the Olympics several foreign journalists, cameramen and photographers were harassed by the police. In Beijing an ITN correspondent was arrested covering a demonstration by pro-Tibet demonstrators. In Xinjiang two Japanese citizens filming a story about a terrorist attack on a police station were beaten, arrested and had their equipment smashed. An apology was forthcoming from Beijing authorities but with a comment stating the journalists should not have been in the area. It remains to be seen whether anything changes.

Further food scandals have prompted authorities to offer apologies to consumers that fell sick in Japan. Frozen green beans contaminated with insecticide has sickened several Japanese people who ate them [CNN / Xinhua].

Meanwhile it is the financial crisis that is biting China the hardest. Hundreds of toy workers protested outside factories and government buildings in Guangdong after they were made unemployed [BBC]. The credit crunch as well as scandals of tainted and unsafe goods have taken their toll on much of China’s manufacturing base. The Chinese news agency Xinhua said 52.7% of the country's 3,631 companies making toys for export went out of business in the first seven months of the year. But it’s not just toys. Car prices were also forced down after a drop in sales [Xinhua]. And although there were slight gains on China’s stock market on Friday, the market remains volatile [China Daily].

Thursday, October 16, 2008

Queen Elizabeth II visits Google


Google was given the royal seal of approval when Queen Elizabeth II visited the London headquarters on Thursday. She even had a fit of the giggles during the tour after the royal party was shown a clip of a baby with an infectious laugh from the company's YouTube site. Google marked the occasion with a special "Google doodle" of the Queen's profile and a crown which it placed on it‘s homepage. The Queen met with 16 schoolchildren who had won a completion as well as staff at the Google HQ. During the tour the Queen also uploaded a video onto the popular video website [BBC / CNN / Fox News / Royal Channel on YouTube]. It was a good day for Google which released figures showing a 26% increase in its third quarter profits. It prompted a 10% rise in its share price in after hours trading, one of few stocks that made any gains [The Australian]. Markets around the world continued to see further volatility for a second day running with significant drops seen on the FTSE and Nikkei once again. The Dow gained some on Thursday closing at 4.68%, but European and Asian stocks tanked once again most ending at around 5% down.

US - Tax and energy dominates last debate


In the last presidential debate both candidates seemed relaxed as they battled each other in a war of words over their respective policies. While McCain spelt out his intentions peppered with criticism of Obama, his opponent in general outlined his proposals without personal and political attacks. In particular John McCain raised issue of Barack Obama’s perceived connections with Bill Ayers and that of voter registration organisation ACORN. John McCain said, “I don’t care about an old washed up terrorist, but we need to know the facts about ACORN and Ayres”. Obama dismissed connections of both parties to his campaign. “Lets get the record straight, when I was 8 yrs old Ayres was involved in despicable acts” Obama said. But although he conceded to having served on the board of a community anti-poverty group, the Woods Fund of Chicago, between 2000 and 2002, with Ayres, Obama insisted that the former anti-war activist was not “involved in my campaign and won’t advise me in the White House”.

The personal attacks at Republican rallies were also discussed but McCain defended his own position. “I’m proud of the people who come to our rallies and obviously we get some fringe peoples ... And I have repudiated people if they’ve been out of line” McCain said. He was referring to recent meetings where some members of the audience had aired strong opinions against his opponent. One woman had expressed concern that Obama was an Arab, but was put right by McCain who defended the Democratic candidate, “No ma’am, he’s not. He’s a decent family man whom I have disagreements on a number of fundamental issues” [You Tube].

But it was the financial crisis that dominated much of the debate. “Americans are hurting right now and they’re angry, and they have every reason to be angry” Obama said, “But we need short term and long term fixes”. He blamed the Fannie Mae & Freddie Mac debacle as the main cause of the mortgage problems in the US. “We are experiencing the worst financial crisis since the Great Depression” Obama declared. If structured properly tax payers would get their money back from the $750 billion rescue package, he added. But he said, “We must make sure CEOs do not benefit from the proposals”. He said it was important to focus on jobs, including overseas jobs and help families with a middle-class tax cut. Both candidates talked of helping home owners but there were still strong opposing opinions on tax policies.

McCain insisted that Obama’s tax plans would affect business. “Small business income tax would affect entrepreneurs”, McCain said, “business tax must be cut to encourage businesses”. But Obama disputed claims made by McCain. “Ninety five percent of families would get a tax cut”, Obama said, and in a reference to ‘Joe the plummer’, he said, “I want to give them a tax break now”. Joe Wurzelbacher came to prominence after tackling Obama’s tax policy at a rally in Ohio [BBC].

But McCain continued to criticise Obama‘s tax policy. "Joe wants to buy the business that he's been in for all these years. Worked 10, 12 hours a day. But he looked at your tax plan and he saw that he was going to pay much higher taxes," John McCain said. "And what you want to do, to Joe the plumber, means more like him have their taxes increased, and not be able to realise the American dream."

Both candidates saw the importance of solving the financial crisis. “Once we get through this economic crisis we can’t go back to the old ways of living beyond our means” Obama said, adding that both parties should work together to solve the problems facing America “if were going to solve two wars and the worst financial crisis in living history”. He went on to say that both parties must learn to “disagree without being disagreeable”.

Speaking about their respective running mates, both heaped praise on them. Obama described Joe Biden as “one of the best public servants who has served this country” who has “helped fight for the little guy”. Sarah Palin was described by McCain as a “Role model to women, and a reformer”. He went on to describe her strengths. “When she saw corruption she resigned and she faced down oil companies” McCain said, “we need a breath of fresh air”.

On energy both candidates seemed to argue over very similar policies. Both talked of energy independence which McCain said would bring increased employment. “I think we can reduce our dependence on foreign oil by building nuclear plants right away” McCain declared, something which Obama has all but rejected. But both talked of increasing the use of alternative energy; wind, tide, solar, geo-thermal and clean coal technology. There was also disagreement over timescales and from whom America should buy oil. Obama said “In ten years we can reduce our dependence on Venezuelan and Saudi Arabian oil” but McCain said he could reduce America’s reliance on foreign oil much sooner.

On trade both candidates were at loggerheads. “I believe in free trade but we must enforce rules against China and South Korea” Obama said. But McCain insisted Obama wanted to “restrict trade and increase taxes”.

Health care and education were also divisive issues. Obama said more money was needed for preventive care while McCain talked of health and fitness programmes to help reduce the rising obesity in America. He also insisted that Obama wanted to bring about health care bureaucracies as seen in England. However Obama responded by saying McCain would tax health care policies. He insisted people of America would benefit better from his proposals. He wanted people to choose the type of health care they wanted and not one imposed by Senator Obama.
Abortion also split both candidates but Obama said that while the two disagreed on the right to abortion they should come together in providing better education to the youth on contraception. Preventing unintended pregnancies, providing adoptive options and help for single mothers who want to keep their unborn child would reduce the need for abortions, Obama said.

With more money spent per capita for education in the US than anywhere in the world both candidates were asked how they would reform the educational system. “We’ve got to get our education system right and we’re going to have to invest in an army of new teachers with higher standards, accountability and make college education more affordable” Obama said. But while McCain said education in the US should be improved he added that “Throwing money at the problem is not the solution”. He proposed an “Increase in student loan availability and a realistic payback plan”. He added that “Spending more money isn’t always the answer” and that reform was needed along with providing vouchers for education.

In the final summing up McCain insisted the issue of trust was all important in the upcoming election and urged Americans to vote for him. Obama echoed the issue of trust and insisted that the government had failed the people. “Washington’s unwillingness to tackle problems has resulted in the [financial] crisis America is facing right now” Obama said. “Were going to have to invest in America’s future. It’s not going to be easy and it’s not going to be quick”, but he added, “I promise you, I will work tirelessly for the future of our children”.
[BBC / Sky News / CNN / mydebates.org]

Wednesday, October 15, 2008

Markets fall as unemployment rises



UK unemployment has risen to 1.75 million, with more than 164,00 being made jobless between June and August, the biggest rise since 1991. The 5.7% increase in people seeking work does not take into account thousands who have lost their jobs in September and early October as the credit crunch and financial crisis forces companies to streamline their operations. The British government said it would release £100 million in funds to be injected into training schemes. But the rhetoric and promises will be of little comfort for thousands of families struggling to pay their bills and mortgages [BBC].
There was some good news as some petrol retailers dropped prices in the UK. Asda and Morrisons, two leading supermarket chains, have dropped prices of unleaded fuel to just below £1 per litre [Sky News].
Meanwhile stock markets were once again in turmoil following gains seen on Monday and Tuesday [CNN / BBC]. The FTSE 100 fell over 7.16% while the CAC 40 and DAX also closed down 6.82% and 6.49% respectively. The Dow Jones has alsoi seen falls throughout the day with at least a 3% drop on Wednesday trade so far. In China there were also falls on the Shanghai Composite Index which declined 1.12% [Sky News].

UK - Terrorist bomber pleads guilty


Guily plea: Reilly was "radicalised" by Islamic extremists

A 22 year old man with a mental age of ten has pleaded guilty to an attempted terrorist attack on mainland Britain. Nicky Reilly, who adopted the Islamic faith, was “preyed upon” and “radicalised” by unknown Muslim extremists according to police. However no other suspects have been arrested in connection with the failed attacks carried out by Reilly who has taken the Muslim name of Mohammad Rashid Saeed-Alim. Reilly, who lived in Plymouth, had attempted to plant two devices at the Giraffe restaurant in Exeter, south-west England on 22nd May this year. But as the Muslim convert was priming one device it exploded injuring him. The other device was made safe by bomb disposal engineers. Reilly will be sentenced in November [BBC / Sky News].

The guilty plea on Britain’s latest terror trial comes on a day when Home Secretary announced new security measures. They will include new obligations for internet and mobile telephone communications companies to provide more information about customer useage. Some reports suggest the government wants a single database to store details of every UK phone call and e-mail sent. The new proposals will be announced as part of the Communications Data Bill in the Queen’s Speech at the opening of parliament in November [BBC]

Tuesday, October 14, 2008

Bush announces more rescue plans


President Bush has made an announcement outlining new proposals in tackling the financial crisis. He said he would use some of $750 billion bail out plan to inject into banks. He said that there would be temporary loans to banks to allow a better flow of cash between banks. “When money flows more easily between banks people will find it easier to obtain loans” President Bush said. Taking much credit for plans implemented across Europe, he said that his meeting with G7 leaders had resulted in a coordinated plan to tackle the crisis. “Yesterday leaders in Europe went forward with this plan” he said, and described them as “wise and timely actions”. His plans which hold strong similarities to those implemented in Europe would, “Strengthen banks across our country”, he insisted. But he recognised that some were still concerned. “I know Americans are deeply distressed”, he said, “I recognise the action taken can seem distant from those concerns. But they will help our economy recover”. He added that his plan, formulated with Henry Paulson was “Broad, flexible and aimed at the root cause of this problem” [BBC].

As far as the markets were concerned there was a return to some confidence. The Hong Kong Hang Seng gained 3% but Japan’s Nikkei index saw the biggest rise gaining 14%, the biggest one day rise since October 1990. The Dow Jones also made record gains with a rise of 936 points, an 11% jump [BBC]. The massive rise did not recoup losses seen in the last two weeks. And it repeats a similar picture following 9/11. On September 17th the Dow fell 14% on its first day of trading following the terrorist attack. It regained some losses the following week, but only by around half of that lost. It is the history of such ups and downs that is resulting in continued uncertainty. For many the roller coaster ride is not over yet.

As President Bush acknowledges, many ordinary citizens are still concerned, not only about their savings, but also about their mortgages, repayments and jobs. And that concern doesn’t just exist in the US. Across Europe there has been outspoken anger and criticism from many members of the public. One disgruntled British citizen aired his grievances to a television crew. “So taxpayers’ money has been loaned to interest free to banks so that they can lend me, a taxpayer, money and charge interest” he said, “that’s not right is it?” There is also concern that while some banks have effectively been nationalised, even if only in part, there will exist an imbalance in the banking sector. While Lloyds TSB, HBOS, RBS, Bradford & Bingley and Northern Rock are essentially being part run by the government, others such as Barclays and HSBC are having to compete in an uneven market. On the High Street, many retailers are continuing to see falling sales. Inflation has hit 5.2% in the UK adding to the financial uncertainty for millions [BBC].

Nikkei soars on Tuesday open


The Nikkei index has soared more than 10 percent on its Tuesday morning open following a holiday on Monday. The market hit 9% within minutes of the opening bell and has soared to 12% in the hour. Markets around the world have gained significantly after a number of cash injections into banks were announced by European leaders on Monday. The Dow closed at 11.08% up on the day's trading while the FTSE closed 8.26% up. In France the Paris CAC closed 11.18% up and the Dax also made similar gains in Germany.

Monday, October 13, 2008

Brown bails out three UK banks


Markets have seen some recovery following an announcement by the British prime minister to pump billions of pounds into Britain’s banks. Lloyds TSB, RBS and HBOS will be injected with £37 billion of taxpayers money. The cash injection will give the government a say in how the banks are run including the issuing of bonuses to top management bosses [BBC]. Speaking on Channel Four News, Yvette Cooper, Chief Secretary to the Treasury, said the “extraordinary measures” were needed because Britain was facing “extraordinary times”.

The FTSE gained around 8% on the day’s trading while the Dow Jones also saw significant gains [Sky News]. However it was not all good news. Shares in the three major banks lost value following the bail out announcement [BBC].

Germany, France and Spain also made similar moves adding to the confidence on trading floors around the world [BBC]. Meanwhile the Icelandic stock exchange remained shut on Monday while talks between authorities in the UK and Iceland continue [BBC].

UK government's terror bill defeated


The House of Lords has rejected the British government’s proposal to extend the length of time terror suspects may be held. There were 309 to 118 votes against the bill. Jon Craig, Sky’s political correspondent, described it as a “crushing humiliation for the government”. The government had wanted to extend the time that suspects could be held from 28 day to 42 days. But there has been strong opposition from both opposition parties. Earlier this year David Davis, the then Shadow Home Secretary, resigned his post to fight a bi-election on the issue.
In the House of Lords, Lord Dear has called ministers' plan "shabby" and "flawed". Speaking in the house today he said, "This attempt to appear tough on terrorism, I believe, is a shabby charade which is unworthy of a democratic process and we should reject it." But Liberal Democrat Lord Carlile, the official reviewer of terror laws, said it was an "appropriate" attempt to save lives. The House of Commons backed the extension in terror detentions by just nine votes in June, with 36 Labour MPs rebelling against the government [BBC].

In another development in the investigation into the death of Jean Charles de Menezes, it has been revealed that a Special Branch officer changed evidence during the original inquest. The Special Branch officer, named as Owen, said he deleted a line from computer notes which quoted Deputy Assistant Commissioner Cressida Dick. The Independent Police Complaints Commission said it would investigate. Brazilian Mr de Menezes, 27, was killed by police who mistook him for one of the failed 21 July 2005 bombers [BBC].

Outside parliament there was an unrelated demonstration which had attempted to breach security. Hundreds of people had gathered to protest against climate change and airport expansion. A number of arrests were made but there was no breach in security according to police.

Friday, October 10, 2008

Markets see red on black Friday


Markets across the world have slumped with massive losses on virtually all stock exchanges. In fact the only exchanges not seeing any downward trends were those that had suspended trading [BBC].

It was one of the worst weeks in Wall Street history with significant drops across the board. Yesterday the Dow fell by more than 600 points adding to a turbulent week which has seen a 17% drop in the week, 39% down on the year. In Europe there were also massive slides. The FTSE 100 has fallen from 4,980 to around 3,800 in the week, a 20% loss in its value. Over the year the FTSE has lost 40% of its value. The DAX and CAC 40 also saw major drops at the beginning of trading falling some 8 to 9% before beginning to rally. Asia saw massive drops with the Nikkei closing at 9.6%, the Hong Kong Hang Seng down 8%, the South Korean Kospi down 4.13% and the Shanghai composite dropping 3.57%. In Australia the ASX 200 also fell 8.34%. Some markets were suspended, amongst them the Vienna Stock Market and the Russian stock exchange. Icelandic markets have suspended until Monday.

The Dow flew into positive territory at 14:07 GMT after 37 minutes of trading bringing cheers from the trading floor. But soon after the rise it fell back into negative figures once again. The US market has lost an estimated $8.3 trillion in stocks over the year, according to CNN, and the outlook still remains uncertain [CNN]

Ahead of a meeting of G7 leaders, George Bush made a statement in which he tried to reassure the American public. “If you’re struggling to pay your mortgage there are ways you can get help” Bush said, as he outlined a number of proposals to tackle the issue. The biggest threat to the financial market was fear, President Bush said, adding to the financial uncertainty. “We will solve this crisis” he insisted, adding that the US economy was “innovative, industrious and resilient”.

Britain’s Chancellor of the Exchequer, Alistair Darling, has flown to Washington to discuss the ongoing crisis [BBC while UK treasury officials have flown to Reykjavic to meet with the Icelandic Prime Minister [BBC]. Yesterday there were strong words exchanged between Britain and Iceland after all the major banks were put into receivership, effectively putting out of reach hundreds of millions of pounds belonging to taxpayers, councils and other organisations. More than 90 British local authorities have money deposited in one or more of the Icelandic banks amounting to an estimated £1 billion [BBC]. It has also emerged that Transport for London and the Police Authority had also deposited money in the troubled banks. The list of failing financial institutions is growing ever bigger with barely a day going by without the mention of another bank or building society needing help [BBC]. After the collapse of Lehman Bros and the propping up of insurance giant AIG, Britain saw the near collapse of HBOS. Lloyds TSB came to the rescue on that occasion but it was effectively left to the British government to step in and save Bradford & Bingley from collapse. Europe has not escaped the effects on its financial institutions. The European bank Fortis also had to be nationalised after running into trouble [BBC].
But then came the shocking news from Iceland. Kaupthing Singer & Friedlander, Landsbankinn and Glitnir were all declared insolvent and taken over by the Icelandic government. Geir Haarde, the Icelandic Prime Minister, was angered by words and action by Britain saying that his country was being treated as if it were a terrorist organisation. Gordon Brown froze assets belonging to Icelandic businesses and described Iceland's failure to guarantee British savers' deposits as "effectively illegal" and "completely unacceptable". But the protestations may have little effect on a small island whose banks no longer have the money to pay its customers [Sky News]. The bigger danger is that such situations may lead to a trade war. And it may not end with Iceland as it has become common practice for savers, both big and small, to place their money in offshore accounts.
The economic crisis is also likely to take it’s toll on governments. Adam Boulton, Sky’s political correspondent, while acknowledging that some have called the current crisis facing Gordon Brown as his ‘Falkland’s moment’, said that it was more likely that the electorate will turn their backs on him at the polls. Speaking on BBC’s This Week, he said that if Brown sorted out the financial crisis, voters would probably turn their back just as they did with John Major after Black Wednesday. “It happened to Churchill, he wins the war and he was put on his bike” Boulton said. Brown is unlikely to gain much gratitude for his efforts of saving Britain’s economy, despite a small upswing of popularity in the polls. His bringing back Peter Mandelson may have brought fresh blood to a beleaguered party, but it may also be another nail in Brown’s coffin.

Thursday, October 09, 2008

Financial coverage varies between broadcasters


Broadcasters have switched much of their coverage to business news in the wake of the financial crisis. Normally the reserve of business channels like Bloomberg, a rolling ticker showing market data has been added to Sky News. The ticker is in addition to the usual rolling news ticker and clock that sits at the bottom of the screen. Sky has also been showing a small information box at the top left of the screen updating viewers with the ups and downs of the FTSE and Dow Jones. CNN has also added a small info-box updating viewers with the current level of the Dow Jones, though its use has been intermittent. The BBC, Russia Today, France 24 and Al Jazeera have not adopted such information straps and CCTV-9, rarely one to show rolling news has continued with regular broadcasting throughout the economic slump.

As for coverage of events, this has varied again from one broadcaster to another. Tuesday’s calmer markets resulted in many station to reduce their business coverage and report on other stories or return to regular programming. Sky has provided a great deal of in depth analysis, along with the BBC and CNN. But there have been missed opportunities. While the BBC were covering a press conference given by the Icelandic Prime Minister today, neither CNN or Sky gave over LIVE coverage to the event. It was a similar story when the former CEO of Lehman Bros, Dick Fuld, was grilled in the US. This was only shown on Bloomberg and Sky News. Neither the BBC or CNN were on the ball with this event.
To expect some of the other news broadcasters, RT, France 24, CCTV-9 and Euronews, to have a grip on the ever changing story was perhaps asking a bit too much, but even al-Jazeera has failed viewers, in general terms, in its coverage of events.

Recession looms as crisis continues


The financial stability of British local authorities has been called into question after it was revealed that they may lose millions of pounds tied up in Icelandic banks that have gone into receivership [BBC]. Dozens of councils had vast sums invested in Landsbankinn, one of several Icelandic financial institutions that have gone to the wall in recent days [BBC].

It is one of the first major signs of how the financial crisis has had a direct impact on Britain. While hundreds had been made jobless in the financial industry, following the collapse of Lehman Bros., the loss of millions from local government coffers may affect hundreds of thousands of British taxpayers. The Local Government Authority said it had identified at least 20 councils with money deposited in Landsbankinn with funds exceeding £1 billion. The Conservative party warned that the crisis may bring about tax increases and cuts in services.

Michael Portillo, a former treasury chief secretary, speaking on Sky News said today that “we’re all in for recession” and that Britain was “looking at a very tough period”. While he condoned the injection of cash into the banks to encourage lending he added a cautionary note. “We need to get back to a world in which people save for things instead of taking out loans” he said. It is not just one politician that sees a difficult time ahead. Despite a turn on today’s markets [BBC], with all the major indexes seeing moves up, financial commentators have warned that markets were not out of the woods yet. “Recession is staring us in the face”, David Buick, of BGC Partners, told the BBC this morning.

The affects of the continuing financial crisis can already be seen on the streets of Britain. Retailers, struggling to move stock, have been cutting prices significantly. Debenhams, a major UK retailer, was marking many items down, some as low as 70% off the marked price. House of Fraser was also trying to drum up trade with a sale. Hundreds of products were reduced with cuts of between 20 and 50%. HMV has cut prices by half on many titles. Even chart DVDs were selling at £8 instead of the more usual £12-16. Several well known retailers have already announced severe losses in profit. BHS saw a 34% fall in annual profits [BBC]. and Marks & Spencer also saw big falls in profit [BBC]. WH Smith has said their profits had flattened but its chief executive said the firm had "delivered another year of good profit performance" [BBC].

It is the housing market that has been badly hit by the credit crunch. With few loans being handed out there is a slump in demand which in turn has forced prices down as much as 13% in the last year according to a report from Halifax today [BBC]. And as those with mortgages struggle to make repayments there is an increase of For Sale signs lining Britain’s streets. For those with any surplus cash there are indeed some bargains. From cars to houses, from DVDs to DVD recorders, consumers have a wide choice of attractive offers. But most are tightening their belts. The uncertainty in the economy is making people think how they spend what cash they do have and how they use available credit. Most people will be more focused on how they are going to pay off existing debt and bills.

As each day rolls by with more businesses closing and stocks crashing, there is the constant dialogue from television pundits debating the effects of the cash injections and rescue packages. But as Richard Quest intimates they “all expect financial markets to react with a degree of certainty” and “don’t see the crisis for what it is”. Writing on his blog for CNN, the correspondent says it may take many months before any real effects are seen. “It will take weeks if not months to bear fruit ... and we can’t point with any certainty to the moment when this thing will turn round - at least not until we see evidence of it” he says. He has a certain incredulous view of those who think the effects will happen instantly. “Those who believe that there is a single “eureka” moment are naïve” Quest insists [CNN]. But while he thinks that the bail out plans and rescue deals will help “damp down the fires” in the financial markets, he says “more interest rate cuts will be needed to increase consumer confidence … and I am NOT saying it will be business as usual. More banks will fail or merge; the wider economy will now start to rock like a ship on stormy seas” [CNN]. Lets hope it doesn’t hit the rocks!

Wednesday, October 08, 2008

Rescue plans and interest rate cuts fail to rally markets


Financial markets have failed to respond positively to cuts in interest rates and proposed rescue packages announced by the British government. Britain, the United States and Europe all agreed to cut interest rates by 0.5% but the move has failed to heighten confidence [BBC]. In Britain a rescue package amounting to £50 billion was announced by Alistair Darling early on Wednesday [BBC].
But despite early gains in trading the FTSE 100 declined later in the day closing at 5.2% down. In Europe stocks faired little better. The CAC 40 dropped by 6.1% while the DAX fell by 5.8%. In the US trading also saw a turbulent day. The Dow and the Nasdaq both saw losses, though the day’s trading has a few more hours to run. However, the biggest losses have been seen in Asia. The Nikkei saw its biggest drop in 21 years finishing 9.4% down [Bloomberg]. There was further bad news after another Icelandic bank was declared to be a liquidity risk. The UK branch of Kaupthing Singers & Friedlander was put into government administration after the Financial Services Authority determined it was unlikely to be able to meet its obligations to depositors [Daily Telegraph].

Besides cuts in interest rates in the West, China also announced it was cutting rates. The one-year lending and deposit rates will be lowered by 0.27 percentage point to 6.93 percent and 3.87 percent effective tomorrow [Bloomberg]. However there may be increased concern after China allowed a return to short-selling which many believe has been partly responsible for the continuing financial crisis [FT]. In the UK and the US a temporary ban on short selling was put in place to curb a practice blamed for allowing speculators to drive down the share price of financial institutions.