Loans and Finance

Loans and Finance

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News and information about loans, money, debt, finance and business issues.

Friday, October 30, 2015

US Avoids Debt Default - For a While

Bloomberg reports that Congress has passed a two-year bipartisan budget plan that avoids a default on U.S. debt, increases spending on domestic and defense programs and ends months of turmoil among House Republicans.

The deadline was 3 November, as such political shenanigans took this up to the wire.

President Barack Obama has a bill that will extend U.S. borrowing authority until March 2017, after he leaves office.

Thus the can has been kicked down the road for a little while longer, and Obama's successor will have to deal with the financial mess that the USA is in.

Thursday, October 29, 2015

Septic Bladder Admits Rigging 2022 World Cup


Sepp Blatter is quoted by Business Insider:
It was agreed that we go to Russia because it’s never been in Russia, eastern Europe, and for 2022 we go back to America. And so we will have the World Cup in the two biggest political powers.
The vote was rigged.

QED!

Wednesday, October 28, 2015

Volkswagen Reports €3.5BN Q3 Loss

Volkswagen have reported a €3.5BN operating loss in Q3, analysts had expected €3.3BN. In the same period in 2014 they had reported a profit of €3.2BN.

The loss is due to the costs (€6.7BN) of recalling 11 million vehicles due to the emissions scandal (aka #VWGate).

Matthias Müller CEO of Volkswagen said of the results, rather incongruously:
The figures show the core strength of the Volkswagen Group on the one hand, while on the other the initial impact of the current situation is becoming clear. We will do everything in our power to win back the trust we have lost.
Volkswagen has a long and hard road to travel ahead!

Tuesday, October 27, 2015

GDP Dips To 0.5%

As per the ONS:
"Change in gross domestic product (GDP) is the main indicator of economic growth. GDP is estimated to have increased by 0.5% in Quarter 3 (July to Sept) 2015 compared with growth of 0.7% in Quarter 2 (Apr to June) 2015."
However, as I have noted many times before, statistics from the ONS are out of date and invariably revised. Therefore do not attach much weight to these figures.

Monday, October 26, 2015

Toyota Take Pole Position Ahead of Volkswagen

Toyota has outstripped Volkswagen in terms of global sales, in the wake of the ongoing emissions scandal aka #VWGate.

Toyota has sold 7.49 million vehicles in the first nine months of the year, compared to the 7.43 million that Volkswagen sold.

In fact, as the Telegraph reports, the results include less than two weeks of sales reporting by Volkswagen since #VWGate became public.

Friday, October 23, 2015

Greece Crisis Resurfaces

Greece is kicking off again!

Get Safe Online Week - #TalkTalk


There's irony for you!

Sadly, it should be assumed that all digital data is at risk of a hack and that at some stage it will be hacked.

Thursday, October 22, 2015

Britain Backs China

Retail Sales Rise 6.5%

Monday, October 19, 2015

The Quadriga Cometh!


China's Growth Falls to 6.9%


Many countries would kill for a growth of 6.9%.

Friday, October 16, 2015

Germany Blackmails Greece

Advice To The Apprentice Candidates

You are not the "Swiss army knives of business", nor are you Alexander The Great!

Thursday, October 15, 2015

#VWGate - FTC Launches Investigation

Things are going from bad to worse for Volkswagen, as it is now under investigation by the U.S. Federal Trade Commission for advertising claims for cars that were marketed as “clean diesels,” but were actually rigged to pass pollution tests.

Justin Cole, a spokesman for the agency, said the FTC is coordinating with the Justice Department and the Environmental Protection Agency, which opened their own formal investigations into Volkswagen last month.

Bloomberg reports that Volkswagen is is delaying or canceling non-essential projects to limit spending, having realised that the $7.4 billion set aside to address the scandal won’t be enough.

Volkswagen also faces more than 280 class-action lawsuits, and some of its executives may face charges.

The FTC has authority to investigate unfair and deceptive practices by companies against consumers and generally seeks refunds on their behalf.

Wednesday, October 14, 2015

Unemployment Falls To 5.4%

Unemployment in the UK fell by 79,000 between June and August to 1.7 million.

Meanwhile in the eurozone, rampant unemployment is tearing society apart!

Tuesday, October 13, 2015

CPI Turns Negative

Britain’s inflation rate has turned negative, for only the second time since 1960 in September.

Annual consumer prices (CPI) fell by 0.1% after stagnating in August, the Office for National Statistics said today. Economists had forecast stagnation.

Prices last declined in April, which was the first sub-zero reading since 1960.

However, the Retail Price Index remained positive; dropping from 1.1% to 0.8%.

What does this mean?

It means interest rates are not going to rise anytime soon, as I have repeatedly said on this site.


Monday, October 12, 2015

State Pension Top Up

Over seven million Britons are being offered the chance to top up their state pensions.

Men over the age of 65 and women over the age of 63 can get up to £25 a week extra on their state pension, in return for a one-off payment.

The size of the top up depends on age and how much extra a week (maximum £25) they want.

The offer is open to existing pensioners and anyone who will reach state pension age before April 2016.

The top-up payments will rise with inflation, as measured by the Consumer Prices Index (CPI).

In addition, spouses or civil partners will, in most cases, be able to inherit some of the payments. They will get between 50% and 100% of the cash. The rules for passing on the payments are the same as they are with the additional state pension.

Those wanting to apply will now have 18 months to do so. Unlike pensioner bonds, there is no limited pot of money.

Here is a link to the pension top up calculator.

Friday, October 09, 2015

#VWGate - Michael Horn and Cronies Knew Nothing


The CEO of Volkswagen USA, Michael Horn, claims cheat software was introduced by "two software engineers" without management knowledge.

Cogitate on the likelihood of that for the rest of the day!

Thursday, October 08, 2015

Beware The Poisonous Triad - $3 Trillion Credit Crunch

The IMF, in its Global Financial Stability Report, is warning that governments and central banks risk tipping the world into a fresh financial crisis.

Emerging market companies have "over-borrowed" by $3 trillion in the last decade. The oncoming wave of defaults that will imperil an already weak global economy.

Add in a combination of lingering debt burdens in advanced economies, and vanishing market liquidity and you have the "perfect storm".

The IMF wants the Federal Reserve to hold off on its first interest rate hike in nine years, and for the authorities in the eurozone and Japan to continue with unprecedented stimulus measures.

Wednesday, October 07, 2015

#VWGate - It's Not Just The Software


Volkswagen has said up to 11 million vehicles worldwide across several of its brands contain the diesel engine with the software used to cheat emissions tests.

Matthias Mueller, Volkswagen's CEO, is quoted by Post Online Media:
"It will hopefully be fewer, but in any case still far too many."
The recall will begin in January 2016:
"...care goes before speed. If everything goes as planned, we can start the recall in January. 
All the cars should be in order by the end of 2016."
Volkswagen will have to fix the EA 189 diesel engine "in combination with various transmissions and country-specific designs. So we don't need three solutions, but thousands."

A software update will suffice to fix the problem in most cases, but some vehicles could need new injectors and catalyzers. Volkswagen may need to set up temporary specialist workshops to deal with the more complex cases.

Tuesday, October 06, 2015

China Bloody Good 6.8% Growth

The IMF has warned/advised China that it must consign its three decades of “extraordinarily rapid growth” to the past, if the economy is to avoid a hard landing.

The IMF is concerned that using debt-financed investment to boost growth is unsustainable.

Changyong Rhee, director of the IMF’s Asia and Pacific Department, warned of the “dangers of excessive leverage” that were highlighted by China’s recent stock market crash and the risks linked to using investment and credit to lift the economy.

As per the Telegraph:
Since the financial crisis, growth in China has relied heavily on investment and credit, with the biggest build-up of leverage going to state-owned enterprises, the real estate and construction sectors, and weaker corporates. This created growing vulnerabilities which — while still manageable — cannot continue to accumulate.”

That being said, the growth prospects for China (compared to the rest of the world) are still bloody good. The IMF believes China will expand by 6.8% this year and 6.3% in 2016 as the economy moves towards consumption-driven output.

Monday, October 05, 2015

£2BN Lloyds Spring Sale

The government will be offering ordinary investors bonus shares and a 5% discount, as part of the £2bn Lloyds share sale in Spring 2016. This will mark the final stage of Lloyds Banking Group’s return to the private sector.

UK Financial Investments, the Government's vehicle for holding assets acquiring during the financial crisis, has already cut its stake in Lloyds from 40% to less than 12% through a series of sales to institutional investors.

Members of the public will be given a 5% discount to the trading price, and one bonus share for every 10 shares they hold for more than a year - up to a maximum of £200 worth of bonus shares.

Priority in the sale will be given to individuals applying for less than £1,000-worth of shares.

Friday, October 02, 2015

#VWGate - Sales of 4,000 UK Vehicles Suspended


Volkswagen is suspending the sale of 4,000 vehicles in the UK in the wake of the emissions scandal.

It seems that the vehicles may be equipped with the device that cheated emissions tests in the US. This will affect vehicles across the VW group including the VW, Audi, Skoda and Seat brands.

In theory this is a temporary measure, until a technical fix is found.

Thursday, October 01, 2015

#VWGate - 1.18 Million UK Cars To Be Recalled


As the clusterfuck of #VWGate grinds on, it is now apparent that almost one in 10 diesel cars (ie 1.18 million) on the UK's roads may need to be recalled.
The Telegraph states that they are mostly passenger cars, including; 508,276 VWs, 393,450 Audis, 76,733 Seats and 131,569 Skodas, as well as 79,838 vans.

VW said it would contact owners over the next few days to correct the problem, and has set up an online portal where customers can check to see if their vehicles contain the emissions-rigging software.

The group said that it would present "technical solutions and measures to the relevant authorities" in October.

That's all very well and good. However, the sharp eyed amongst you may be pondering, if there really is a viable technical solution why was this not employed at the time thereby avoiding the need for wholesale global fraud?

There is a strong possibility that if there is no viable solution, then the next best alternative for the consumer is to be given a replacement car that does actually meet emissions standards.

We shall see what the outcome really is. However, whatever the outcome, one thing is clear this is going to cost Volkswagen an arm and a leg!