Business & Financial News

The amount of mortgage loans fell by nearly 26% over a year and nearly 50% compared to December. A real "blow". http://www.flickr.com/photos/gcattiaux/

The amount of loans granted by banks recorded a very sharp decline in January, falling 25.7% over the corresponding month of 2011, according to a study by the Housing Credit / CSA published Monday. "The year 2012 did not start very well. In a sluggish economy, the backlash movement anticipation of the end of 2011 is significant," notes the study.

On a monthly basis, the collapse is indeed brutal: -49.4% between December 2011 and January 2012 (after already falling by 34.1% between December 2010 and January 2011). "It's a blow. The fall is comparable to 2009, when the subprime crisis + + U.S., "said Michel Mouillart for AFP, professor of economics at the University of Paris West and industry expert

. For Mr.

Mouillart two decisions specific to the sector in addition to "concerns about rising unemployment, purchasing power and the unfavorable economic outlook". "First of all the strong decrease in the rate (from 22% to 13%) of the tax benefit for investors buying a new home and, in addition, the removal of zero-interest loan (PTZ) for buyers of older homes, "said M . Mouillart

. For the full year 2012, loans granted banks should amount to only 130 billion euros, a drop of almost 20% compared to 2011 (160 billion), far from the high of 2007 (170.2 billion), said Mr. Mouillart. The reversal came after an explosion of these funds since the beginning of the century who had contributed to buoyant property market in France: 70.8 billion in 2001, 87.3 in 2003, 143.7 in 2005 and 170, 2 in 2007.

Interest rates on mortgages continued to rise in January 2012 and have averaged 3.97% against 3.94% in December 2011 and 3.86% in November, a jump of more than 70 points base compared to the lowest level since 1945 (3.25% on average) reached in November 2010, according to Credit Housing.

The Chinese government will send next year a delegation of Chinese investors in Europe to acquire companies. Nicolas Sarkozy and Hu Jintao in Beijing, April 28, 2010. French President visited China for the inauguration of the Expo.

The Chinese government will send next year a delegation of Chinese investors in Europe to "buy European companies," said Chinese Commerce Minister Chen Deming, quoted Tuesday by the newspaper Global Times. "China wants to invest its large trade surplus and will not hold billions of dollars that depreciate," said Chen Deming Monday at a conference in Beijing."We are prepared to further open our market, for example the financial sector, but other savings should in turn be more open to our place," he said, always cited by the Global Times.

The paper does not specify the countries that the Chinese delegation will visit, or the composition of the delegation, or the amount or nature of such acquisitions. China holds huge reserves, which exceeded the end of September 3200 billion. She had invested the same date of $ 1.148 billion in U.S. Treasury bills while according to experts, it holds more than 550 billion sovereign debt of European countries.

Vilmorin confirmed on Tuesday its full-year after a first quarter marked by an increase of 5.9% on a comparable turnover, particularly due to the field seeds.

The fourth seed said the world from July to September quarter, the first of the year the group has traditionally been the smallest of the year as it weighs just under 15% of total revenue.Over the period, sales reached 178.8 million euros.

"In an uncertain economic and financial environment and despite the supply of maize seeds below the targets initial production plans, Vilmorin confirms its outlook for revenue growth and operating margin for the year 2011-2012 , as announced last October, "the group said in a statement.

Vilmorin is always a growth of over 7% of its consolidated revenues on a comparable basis and an operating margin of 11% research effort included.

European stock markets have reduced their initial losses Thursday mid-morning, investors hope that Greece renounces its proposed referendum on the European aid plan for the country while Angela Merkel and Nicolas Sarkozy launched an ultimatum Wednesday night Athens ordered to implement the overall European level or risk not receiving any help.

At 10:31, the CAC 40 index yields 0.12% after briefly gained 0.3%. The benchmark index of the Paris lost up to 2.6% in early trade.

The London Stock Exchange gained 0.05%, while Frankfurt was down 0.25% and pan-European Euro Stoxx 50 index drops 0.43%.

EDF shares fell more than 5% Friday afternoon in Paris Stock Exchange, market participants have cited an article in Le Monde that the Socialist Party and environmentalists are about to sign an agreement providing for election closures nuclear power plants.

Interviewed by Reuters, the two sides, however, said no such thing had been decided yet and that negotiations for the presidential and legislative elections of 2012 in France continued.

The electrician public asked the Financial Markets Authority (AMF) to investigate the collapse of the course.

"Discussions are at this stage, more general," he told Reuters Michel Sapin, former economy minister, Francois Hollande close and involved in these negotiations.

As for Yannick Jadot, spokesman Eva Joly, candidate of Europe Ecologie-Greens, he felt that the article in Le Monde shows a vision "a little fictionalized" reality.

"Should there be an agreement between the two, Fessenheim shut fairly quickly.(…) We are still at an output of nuclear power including actual closing fast enough for the older plants, "he said.

He hoped that negotiations with the Socialist Party end up in the next 15 days.

François Hollande, Socialist candidate for president, wants a drop from 75% to 50% of the share of nuclear in electricity generation.

The central Fessenheim is the oldest in France and has two reactors of 900 megawatts each.

Last summer, the Nuclear Safety Authority (ASN) found that the No. 1 reactor of the plant was capable of being operated ten years older.

Between the peaks decisions that decide nothing and unexpected twists, difficult to navigate in the soap extension to the rescue of the euro. L'Expansion. Com reported on what appears achievements and problems that appear before the appointment-critical? – Wednesday. European leaders meeting in Brussels.

While the EU summit Sunday was to end months of indecision and too limited solutions, the world was offered a new appointment on Wednesday to see whether the euro area will finally be saved. Back to what appears to finally being resolved and the problems that remain … or emerging.

What is clear

The discount massive Greek debt

The banking lobby is hoping for a discount of 40%, Brussels wants instead to 50 or 60%.But if negotiations continue on the final figure, the principle of a very significant effacement of the Greek debt appears to act for both parties. To justify this level, Europe is based on a report of the troika, which includes the country's creditors, European Union, ECB and IMF. According to the report, banks must accept losses from 50% to 60% for the country's debt is sustainable. This prospect terrifies but investors in Greece. The Athens Stock Exchange fell Monday. Concerns focus on the consequences of such a discount to banks and pension funds in the country, who hold 15% of Greek sovereign debt. Local employers in turn denounced a decision that would lead to a "devaluation of financial assets and real estate" of the Greeks and "suffocation of the private sector."

The recapitalization of banks

To absorb losses arising from the discount and deal with a possible extension of impairment to Spain and Italy, banks are encouraged to recapitalize. With two options. Either they agree to promote their sovereign debt to market, whereby they are set a target to achieve a capital ratio of hard 9% by mid-2012. Either they refuse, and then have to meet a higher target of 9.5%. According to a European source, this would represent a comprehensive effort to recapitalize "107 or 108 billion euros."The scenario always favors a priority call to the private sector and the public opening of windows and finally, in case of failure the use of a solution through the EFSF.

On French banks, Baroin reiterated on Monday that Europe 1 "may not need to open this window public" and that they would carry out this recapitalization "at the expense of dividends and bonuses" . Christian Noyer, Governor of the Bank of France, for his part spoke of a limited effort at "least ten billion euros."

Strengthening the EFSF

It is unclear exactly how the European financial stability but we know it will not be converted into bank, as called Paris. Berlin vetoed because it would require the fund to refinance with the ECB, that "treaties do not allow," said Chancellor Angela Merkel.Options to leverage the capacity of intervention of EFSF without increasing resources have been reduced to two. First possibility: make a guarantee fund for the obligations of troubled countries (Greece, Italy and Spain) that protects owners up to 20 to 30% of the loan amount. This insurance should put downward pressure on interest rates. Second option on the table: create a special fund to accept contributions from outside investors, and could be backed by the IMF. But as the EU president, Herman Van Rompuy, both options could ultimately be chosen. "Combined, these two models could have a cumulative effect," he said Sunday.

The new problems that emerge

The non-European contribution to EFSF

The proposed involvement of outside investors – outside the euro area – raises some reservations.The fear of other states to mix with European desnquiétudes rise. "The Chinese said they were interested, but some member states are skeptical about the idea of ​​integrating a Chinese contribution to the EFSF," said one diplomat. Which could ultimately leave the field open to the German proposal as EFSF Guarantee Fund.

The payment of the IMF to Greece

To avoid suffocation in the country, the creditors of Athens must pay the sixth installment of the loan of 110 billion euros. But if Europe accepted Friday the payment of its share (5.8 billion), the IMF still has not cleared the release of funds. The Secretary General of the IMF, Christine Lagarde, said Friday she would recommend the Fund to pay the remaining share (2.2 billion).But for this it will be another meeting of the Board of the IMF in November …

The use of Italy EFSF

Italy is under pressure to further reduce its debt and deficits. Prime Minister Silvio Berlusconi was ordered to reach the European summit Wednesday with a detailed road map for further reforms of its economy, particularly on pensions. "This is not to appeal to the solidarity of partners if we do not effort," even said Nicolas Sarkozy. Now Italy has indeed need that help. She is a candidate to benefit from new support program called "precautionary" developed in July. The tool is expected to be able to provide credit lines or to allow the EFSF to buy government debt from one country to investors in the market "secondary" to influence interest rates.Relief Fund would replace the ECB and redeeming debt from the Italian August but warned that it would not do it forever. Except that Europe now poses its terms. Silvio Berlusconi has already given some pledges by suggesting that it might raise the retirement age to 67. It could also speed up privatization to relieve the huge debt the country to 1,900 billion euros.

The Irish budget deficit has reduced by 4 percentage points of GDP since 2009. Corporate profitability recovered sharply. But deleveraging too fast may influence the activity against becoming productive. Pedestrians in Dublin

If Ireland is still part of PIGS, it can not be in the same category as Greece or Portugal, as progress in a few months by former Tiger European are important. The Irish budget deficit – excluding bank recapitalization needs – fell by 4 percentage points of GDP since 2009. The current account deficit turned into a small surplus. Finally, corporate profitability recovered sharply.

The experts of the International Monetary Fund (IMF) of the European Central Bank (ECB) and European Commission, who have just completed their assessment mission in Ireland, are seduced. "The ongoing adjustment is solid.The 2011 budget targets will be achieved and the ongoing structural reforms will also contribute to sanitation, "they note in their report.

However, Ireland is now entering a delicate phase. Or the risk of too rapid deleveraging weigh on activity, against becoming productive. The experts of the IMF, the ECB and the Commission to admit the hint. "Ireland will have to find a balance between the imperatives of debt reduction and limitation of the barriers to growth and job creation," they point out in their report. This sentence harmless and a bit blurry could announce a change in strategy for Ireland. The country needs it, says a recent report by Goodbody Broker.

Make concessions

Indeed, in Ireland, over-indebtedness affects both the public sector, private sector and banks.Simultaneously reducing the three is clearly a bad idea, says the report. If Ireland is determined to meet all objectives at the same time, the evolving recovery will be quickly suppressed. A risk highlighted recently by the Finance Minister Michael Noonan. Especially since the motor only turns in exports. The domestic market remains depressed by lower prices (unit labor costs fell by 15% and commercial property prices have been divided by two).

We must therefore make concessions to one side. But which one? As for households, the government can not do much. The debt reached 220% of disposable income, nearly twice the international average. And fall of financial markets could reduce household net wealth of 250 billion euros. The Irish are going to have to tighten their belts for several years.Make concessions on the public debt is also not in a financial crisis. Ireland recorded a primary deficit of 6% of GDP in 2011. This is the worst result of the euro area.

Remaining banks. They must bring their ratios to 122% loan to deposit by 2013. The challenge today is to allow banks to achieve that clean without excessively penalizing the credit. This will doubtless involve additional time but also further aid from the ECB, economists now believe. Lengthy discussion in perspective.

Wall Street opened in fall Monday after two weeks of gains, weighed down by a statement by the German Finance Minister Wolfgang Schäuble that the next EU summit will not produce a definitive solution to the debt crisis.

In early trade, the Dow yielded 0.59% (56 points) at 11,575 points.The Standard & Poor's, wider, fell by 0.62% (7.5 points) to 1217 points while the Nasdaq composite lost 0.64% (17 points) in 2650.

Germany warned Monday against the dream "unrealistic" to see the European Summit of 23 October Sunday settle the debt crisis in the euro area, keeping the pressure on banks to grant a discount over important Greek debt.

Wall Street was completed Friday a second consecutive week of gains, seeing the S & P 500 gaining over 8% on the hope of curbing the euro area's debt crisis and the global economy avoid a recession.

But a barometer of manufacturing activity in New York Monday revived fears about the U.S. economy.

The Empire State index of the Federal Reserve of New York stood at -8.48 in October, its fifth consecutive month in negative territory, while the market expected a slightly less marked contraction (-4.00) from -8.82 in September.

Industrial production has in turn increased by 0.2% in September, as expected, the manufacturing sector offsetting a decline in the utilities.

Citigroup gained 1.2% at the opening after reporting a profit increase in the third quarter.The bank has indeed had to be provisioned are less clear for its losses from toxic assets, while benefiting from an accounting gain that banks can reap when financial markets are turbulent.

Wells Fargo lost 5.6% after posting a profit rise in third quarter but have just missed the consensus of analysts.

The pessimistic comments by the Fed on the U.S. economy were right the last hopes of the market. Paris loses about 5% as other European markets, the euro and oil fall as well.

Financial markets no longer know where to turn. They awaited the Fed's effective measures to stimulate activity, they have mostly kept very pessimistic comments on the U.S. economy. And as concerns over the health of European banks are still there, the world's stock markets have performed a new dive on Thursday.

After opening sharply lower, European stock markets accentuated their losses by mid-afternoon. The Paris Bourse and yielded 4.57%, Frankfurt 3.77%, 4.70% London, Milan and Madrid 3.70% 4.40%. At the opening of the New York Stock Exchange, the Dow Jones lost 1.45% and the Nasdaq 2.85%..

Bank stocks, especially French, were the first victims of this new access of depression. Societe Generale, Credit Agricole and Natixis were down more than 7%. BNP Paribas, some limited damage to -3.3%. Alarmist comments by an officer of the influential American fund Pimco, saying that French banks could tip the whole of Europe into recession, came to power concerns.

Equity markets are not the only ones suffering. Direct result of growth at half mast, and thus reduced demand, oil prices plunged more than 5% in New York, returning to their lowest levels in a month. A barrel of "light sweet crude" for November delivery traded at 80.91 dollars.

On the foreign exchange market, the euro has meanwhile fallen below $ 1.35. It especially touched its lowest level for ten years against the yen.

Main accused of helping the new blues, the U.S. central bank. "The Fed, instead of reassuring the markets, instead encouraged the weak operators and increased their aversion to assets considered risky," explained Jane Foley, analyst at Rabobank.

As expected, it has announced the launch of Operation Twist, which will be for sale by the end of June 2012 for $ 400 billion of treasury bills in order to redeem an equivalent amount with a longer maturity. The stated objective is to lower interest rates over time. Problem, the effectiveness of the measure is highly controversial because these rates are already low. Its impact on business would not be obvious.

Unconvincing in action, the Fed, however, impressed the market by the extent of his pessimism on the U.S. economy, citing the "continuing weakness" of the labor market and "significant risks" associated with "tensions global financial markets. " Expected as the messiah, Bern Bernanke, the head of the U.S. central bank has disappointed. The Fed "does not have the tools to miraculously revive economic growth," could only observe Nigel Gault, the firm IHS Global Insight.

Several indicators have confirmed the sluggishness of activity across the Atlantic, like the new jobless claims last week to 423,000, down but higher than expected (418,000). For its part, the Conference Board's composite index came out up 0.3% in August, but slowed down, which is a sign of increased risks to growth.The U.S. treasury secretary, Timothy Geithner, has found himself in Washington that the slow economic growth was a challenge "bigger" than the debt that states the world should give priority to support growth.

As if this were not enough, the bad news continued to accumulate on the side of the euro area. The private sector activity there is in fact contracted in September for the first time in over two years, according to a first estimate of the firm Markit PMI. The activity slows and approaches the stagnation in Germany and France, the two largest economies in the region, the source said. Italy, whose financial markets worried, revised sharply downward its growth forecasts, reduced to 0.7% for 2011, 0.6% in 2012 and 0.9% in 2013.Rome assured that the austerity plan passed last week was enough to balance the budget by 2013. But the bond market, the Italian securities suffered, with a standard rate record deal with German titles, safe havens in which investors have rushed. The performance of the German Bund and 10-year fell to its lowest ever observed in 1.665%.

The debate continues in Europe on the recapitalization of banks, following the call to use the IMF's European Financial Stability Fund (EFSF) to recapitalize the most exposed to the debt crisis. The IMF estimates the potential losses in the sector to 200 billion euros. Echoing the words of his colleague in charge of Competition, Joaquin Almunia, European Commissioner Michel Barnier to Financial Services found that 25 of them need to be recapitalized.

The three main French banks have made a spectacular recovery on the stock market Wednesday afternoon, unconfirmed rumors recapitalization that gave a boost to their titles.

As they signed in mid-day the worst stock market performance of European banking sector, BNP Paribas, Credit Agricole and Societe Generale took up to 3:45 p.m., respectively, 1.95%, 0.52% and 0.79% while the European banking index fell by 0.13%.

"We feel that the market is abuzz with rumors and there is nothing really solid.I think the market will come back (back), "said one trader told Reuters.

A spokeswoman for BNP Paribas has denied rumors the new recapitalization.

"In the words of (the president) Michel Pébereau yesterday we currently have no need to be recapitalized," she said, noting that his bank had just signed one of his best performances in history in terms of results .

French banks were attacked in the morning, some operators are worrying about their access to liquidity despite the increase in denials.

The climate has become particularly burdensome for banks in recent weeks hexagonal where announcements of measures to promote the return of market confidence have been ineffective.

The German group Siemens has withdrawn funds early July of Société Générale as a result of under-performance of an investment, but the news was interpreted by some as indicative of the financial health of the bank.

Similarly, the decision by Standard & Poor's to lower the sovereign rating of Italy, although it was expected by the markets, also helped fuel the fears of contagion from the crisis of debt in the euro area.