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It`s recession in US, confirm economists

New York, March 14: Economists are increasingly certain that the US has slid into recession, according to a latest survey by the Wall Street Journal.

Following months of specualtion about the dreaded 'R' word, the new survey shows a "precipitous shift" toward pessimism from the previous one conducted five weeks earlier and is reinforced by new data showing a sharp drop in retail sales last month, the paper says.

Thirty-six of 51 respondents, or more than 70 per cent, said in a survey conducted March 7-11 that the economy is in recession.

The Commerce Department had said earlier this week that retail sales fell 0.6 per cent in February; sales excluding the volatile auto and auto-parts categories fell 0.2 per cent.

The declines, the Journal says, reflect a sharp slowdown in consumer spending, which accounts for more than 70 per cent of US economic activity, as Americans grapple with high gasoline and food costs and declines in home values and other asset prices.

The economists, it said, now expect non-farm payrolls to grow by an average of just 9,000 jobs a month for the next 12 months -- down from a previously expected 48,500.

Twenty economists expect payrolls to shrink outright. On average, the economists predicted the unemployment rate will be 5.5 per cent in December, up from the current 4.8per cent.

The economists, on average, forecast meager economic growth -- just 0.1 per cent at an annual rate in the current quarter, and 0.4 per cent in the second, the survey shows.

Although the classic definition of recession is two consecutive quarters of declines in the gross domestic product, Stephen Stanley of RBS Greenwich Capital was quoted as saying that the National Bureau of Economic Research, the nonpartisan organisation that is the official arbiter of recessions, doesn't always strictly follow that definition.

"If you go back to the 2001 recession, there was only one negative GDP quarter, and there might not even be one negative quarter in this recession," he said.

Almost half the economists surveyed said a recession this year could be worse than the 2001 and 1990-91 downturns. Amid the rising concerns, respondents expect more action from policy makers.

Some 63 per cent said the use of public money to deal with the housing crisis is now likely or certain, while on average they expect the Federal Reserve to lower the target for its benchmark federal-funds rate to 2 per cent by June from the current 3 per cent.

Fed policy makers, the Journal said, meet on Tuesday, and futures markets are fully pricing in at least a 0.5-percentage-point cut in the rate and indicating a 90per cent probability of a 0.75-point cut.

Officials had, before this week, been unconvinced that a 0.75-point cut was needed, given signs that inflation psychology is worsening, the report added..

But those views, it says, may have been affected by continued upheaval in credit markets, as well as weak retail sales and employment data.

Asia-Pacific braces for mobile tv

Kuala Lumpur, March 14: The Asia-Pacific mobile video services market, covering 12 Asia-Pacific countries excluding Japan, will reach a revenue of USD 1.88 billion by end-2013 which stands at USD 440 million in 2007, a compounded annual growth rate of 27.4 percent, says Frost & Sullivan.

Mobile tv, essentially an extension of mobile video services, is seen as a new killer application that can potentially bring alternative sources of revenues for carriers.

"Amidst the growing interest in triple-play and mobile advertising, mobile tv has been the buzzword in the Asia-Pacific mobile and wireless market," said Shaker Amin, an industry analyst at the global business research and consulting firm, in a statement received here yesterday.

He noted that South Korea, which accounted for 87 percent or USD 383.7 million of the revenues in 2007, would remain the biggest market for mobile video in the Asia-Pacific ex-Japan while other potential leading markets included Singapore, China, Hong Kong, Taiwan, Australia and New Zealand.

"The recent spate of trials and the commercial launches of broadcast networks in Japan and South Korea indicate that the mobile tv fever could well catch on throughout the Asia-Pacific region," he added.

Two of the most mature mobile markets, South Korea and Japan, have introduced mobile tv broadcast services ahead of other Asia-Pacific countries built on homegrown standards.

Economy going through tough times: Bush

New York, March 15: President George W Bush, seeking to bolster faith in the economy amid fears of a recession, acknowledged on Friday the United States was going through hard times but said growth would resume over the long run because economic fundamentals were sound.

Democratic presidential candidate Hillary Clinton countered that much of the country was already in a recession.

With oil prices at record highs, the mortgage market on the verge of meltdown and the specter of recession looming, Bush has been scrambling to halt the slide in the economy.

"In the long run I am confident that our economy will continue to grow because the foundation is solid," Bush told about 500 people at the nonpartisan Economic Club of New York, a group of top business executives, bankers and economists.

Bush`s trip to New York came amid reports of further slippage in consumer confidence and word that the Federal Reserve and JPMorgan Chase had agreed to provide emergency funding to Bear Stearns because of a credit crunch at the major US investment bank.

Campaigning in Pennsylvania, which holds the next primary contest on April 22, Clinton renewed her attack on oil company profits and accused Sen Barack Obama, her rival for the Democratic presidential nomination, of supporting tax breaks for oil companies.

Speaking at a campaign rally for about 2,000 supporters in Pittsburgh, Clinton said both Obama and Republican presidential candidate Sen John McCain had voted for a bill to cut oil company taxes.

"They voted yes to more giveaways to the oil companies," she said in a 40-minute speech.

Windfall Tax

Citing Exxon Mobil Corp`s latest annual profit of USD40 billion, Clinton said that as President, she would require oil companies to invest in alternative forms of energy or else be subject to a windfall profits tax.

Development of alternative energy sources and the promotion of energy independence could generate 5 million new jobs in the next 10 years, she added.

Earlier on Friday, Clinton visited a Pittsburgh gas station to promote her plan to fight the high energy costs she said are hurting the economy.

"There are many places in our country, and there are many families that are already in recession," Clinton said. "I believe we are on a course that is going to worsen that economic stress."

As conditions have gotten worse, the economy has surpassed the Iraq war as the top concern of voters who will pick Bush`s successor in November.

That could bode ill for presumptive Republican nominee John McCain, who has made national security the centerpiece of his candidacy and once said the economy was not his strong suit.

McCain, who has visited Iraq seven times, plans a trip to the Middle East and Europe next week.

Clinton, a New York senator and former first lady who would be the first woman President, will continue her battle for the Democratic nomination with Illinois Sen Barack Obama, who would be the first black president.

Obama was forced to quell another campaign controversy tinged with race on Friday, repudiating "inflammatory and appalling remarks" remarks made by his Chicago pastor.

"I vehemently disagree and strongly condemn the statements that have been the subject of this controversy," Obama said in a statement, responding to persistent media coverage of Rev Jeremiah Wright`s sermons in which he called the Sept 2001 attacks retribution for US foreign policy and railed against a racist America.

In an interview with a channel, Bush said he trusted McCain to maintain his tax-cutting legacy.

"Not only do I think he will be good (on) tax cuts, I know he`ll be a good, sound, you know, fiscal watchdog," Bush said, according to a transcript.

At a town hall meeting in a Philadelphia suburb, McCain said US economic fundamentals remain strong despite the housing crisis, and said he would soon unveil more proposals to help the economy.

"We will come forward in the days and weeks ahead with more and stronger proposals to try to fix this economy and I`m sure that we can," the Arizona senator said.

No ban on Blackberry, security aspect to be examined

New Delhi, March 14: Amid raging controversy over Blackberry operations by mobile service providers, the government on Friday ruled out banning the service but said security aspects would be looked into.

"We will discuss the issue in the telecom commission... Country`s security is of paramount importance," telecom minister A Raja told reporters on sidelines of a function.

The government is in discussion with the cellular operators like Bharti Airtel, Vodafone Essar and Reliance Communications and the issue would be resolved soon.

Telecom secretary Siddartha Behura said, "we are keen to resolve the issue at the earliest but there is no question of banning the Blackberry services."

The issue of Blackberry services came to light after Tata Teleservices was denied permission by the ministry of home affairs to launch services due to security concerns.

Tatas had claimed that each value added service like Blackberry service has been approved by the government before it was offered to subscribers.

Even the state-owned BSNL is also in the process to launch Blackberry service provided regulatory issues were resolved, BSNL Director (Finance) S D Saxena said.

Developed by Canadian firm Research in Motion (RIM), Blackberry is a patented service that allows access to e-mails on mobile phones just like SMS on conventional mobile phones.

"We are ready to launch the Blackberry service provided the regulatory issues are resolved. If the issues are resolved now, then we can launch our service in one month," Saxena said.

Currently, a number of telecom operators, including Bharti Airtel, Vodafone and Reliance Communications are currently offering Blackberry services to their users.

On the issue of spectrum, the minister said spectrum issues are expected to be resolved soon to the satisfaction and fairness of all concerned.

"We will roll out the spectrum during the regime of this UPA government," he added.

US developments vital to end uncertainty: Reddy

Mumbai, March 14: Noting that US has a key role in ending the current economic uncertainties, Reserve Bank governor Y V Reddy on Friday said policy management becomes tough if fiscal deficit is high.

"There is a determination among policy makers to ensure early end to the uncertainty but a major share of comfort has to come from the US," Reddy told reporters on the sidelines of a lecture here.

He said the apex bank had taken into account high oil and food prices in the January monetary policy.

"Much of what is happening was not entirely unanticipated but its magnitude is sometimes difficult to guess," he said.

"By and large uncertainty exists and are continuing...As of now it is not clear when things will get normal or less abnormal," he said.

Reddy said policy management becomes tough if fiscal deficit is high and current account gap is big.

On interest rates he said overnight rate corridor had served well.

Can you please advise as to when the market will stabilize? Is there any cahnce foe sensex to touch 21000 again? if so when?
Regards

Ketan Parekh convicted in 1992 security scam

Mumbai, March 14: A special court in Mumbai set up to try the securities-related scams has convicted stock brokers Ketan Parekh and Hiten Dalal, along with six others which includes the then top officers of Canbank Financial Services.

Justice V M Kanade of special court (for trial of offences relating to Transactions in Securities Act) held that Parkeh, Dalal and Canfina (Canbank Financial Services) officials entered into a criminal conspiracy to "siphon off Rs 47 crore".

Bangalore-based Canfina, a subsidiary of Canara Bank was the victim of this scam.

Prosecution`s case was that money belonging to Canfina were transferred to accounts with Canbank Mutual Fund in Mumbai by default, but instead of returning the money to Canfina, CBMF diverted it to the accounts of Parkeh and other stock-brokers.

The court is likely to pronounce their sentences on march 28.

Apart from Parekh, those held guilty of criminal conspiracy and misappropriation of funds were: stock brokers Hiten Dalal, S K Jhaveri, Pallav Seth and Navinchandra Parekh; Canfina`s former assistant vice presidents Sainath Mohan, M K Ashok Kumar and former general manager of CBMF B R Acharya.

Former assistant vice president of Canfina N Balsubramaniam, former general manager of CBMF P J Subbarao and B V Shrinivasan of Vysya Bank were acquitted by the court.

These fraudulent transactions took place in October 1991 and January 1992.

Total loss to Canfina was of Rs 47 crore, 70 lakh.

Economy going through tough times: Bush

New York, March 15: President George W Bush, seeking to bolster faith in the economy amid fears of a recession, acknowledged on Friday the United States was going through hard times but said growth would resume over the long run because economic fundamentals were sound.

Democratic presidential candidate Hillary Clinton countered that much of the country was already in a recession.

With oil prices at record highs, the mortgage market on the verge of meltdown and the specter of recession looming, Bush has been scrambling to halt the slide in the economy.

"In the long run I am confident that our economy will continue to grow because the foundation is solid," Bush told about 500 people at the nonpartisan Economic Club of New York, a group of top business executives, bankers and economists.

Bush`s trip to New York came amid reports of further slippage in consumer confidence and word that the Federal Reserve and JPMorgan Chase had agreed to provide emergency funding to Bear Stearns because of a credit crunch at the major US investment bank.

Campaigning in Pennsylvania, which holds the next primary contest on April 22, Clinton renewed her attack on oil company profits and accused Sen Barack Obama, her rival for the Democratic presidential nomination, of supporting tax breaks for oil companies.

Speaking at a campaign rally for about 2,000 supporters in Pittsburgh, Clinton said both Obama and Republican presidential candidate Sen John McCain had voted for a bill to cut oil company taxes.

"They voted yes to more giveaways to the oil companies," she said in a 40-minute speech.

Windfall Tax

Citing Exxon Mobil Corp`s latest annual profit of USD40 billion, Clinton said that as President, she would require oil companies to invest in alternative forms of energy or else be subject to a windfall profits tax.

Development of alternative energy sources and the promotion of energy independence could generate 5 million new jobs in the next 10 years, she added.

Earlier on Friday, Clinton visited a Pittsburgh gas station to promote her plan to fight the high energy costs she said are hurting the economy.

"There are many places in our country, and there are many families that are already in recession," Clinton said. "I believe we are on a course that is going to worsen that economic stress."

As conditions have gotten worse, the economy has surpassed the Iraq war as the top concern of voters who will pick Bush`s successor in November.

That could bode ill for presumptive Republican nominee John McCain, who has made national security the centerpiece of his candidacy and once said the economy was not his strong suit.

McCain, who has visited Iraq seven times, plans a trip to the Middle East and Europe next week.

Clinton, a New York senator and former first lady who would be the first woman President, will continue her battle for the Democratic nomination with Illinois Sen Barack Obama, who would be the first black president.

Obama was forced to quell another campaign controversy tinged with race on Friday, repudiating "inflammatory and appalling remarks" remarks made by his Chicago pastor.

"I vehemently disagree and strongly condemn the statements that have been the subject of this controversy," Obama said in a statement, responding to persistent media coverage of Rev Jeremiah Wright`s sermons in which he called the Sept 2001 attacks retribution for US foreign policy and railed against a racist America.

In an interview with a channel, Bush said he trusted McCain to maintain his tax-cutting legacy.

"Not only do I think he will be good (on) tax cuts, I know he`ll be a good, sound, you know, fiscal watchdog," Bush said, according to a transcript.

At a town hall meeting in a Philadelphia suburb, McCain said US economic fundamentals remain strong despite the housing crisis, and said he would soon unveil more proposals to help the economy.

"We will come forward in the days and weeks ahead with more and stronger proposals to try to fix this economy and I`m sure that we can," the Arizona senator said.

Life insurance sector grows by 18%, LIC dips

New Delhi, March 15: India`s life insurance market grew 18 percent between April 2007 and January 2008 with private life insurers witnessing a first premium rise of 82 percent.

The state-owned Life Insurance Corporation of India or LIC however saw a dip in its premium income from the sale of new policies during this period.

Though LIC managed to improve its position in January 2008, owing to a 110 percent rise in first premium income.

Crisis in US economy to hit India

Bhubaneswar, March 15: Warning that recession in the US economy would hit India and shatter its budget projections, CPI-M on Saturday demanded immediate halt to futures trading in all essential commodities to contain inflation and corrective measures for the stability of the rupee.

"In order to check speculation and inflation, futures trading must be stopped in all essential commodities though the government has removed pulses, wheat and rice from the purview of forward market due to our pressure," CPI-M politburo member Sitaram Yechury told reporters here.

Stating that the US has officially admitted that its economy was going through rough times, he said, recession, falling value of dollar and growing unemployment in America would have adverse impact on India and the government must initiate corrective measures to tackle the situation.

Observing that rupee has appreciated by 13 percent during the past one year, he said decline in exports and manufacturing sector coupled with badly hit it and textile sectors would cause considerable loss of jobs.

He said that such a situation has put the projections in the Union Budget into uncertainties.

Voicing his party`s determination to prevent signing of the nuclear deal with the US, Yechury said "our agenda is not to destabilise the UPA government at the Centre but to stop the nuclear deal. It is for the government to decide its future course of action."

He said Left parties would discuss the whole gamut of issues relating to the deal with the government during the meeting slated for March 17.

The Left parties would also like to see and study the draft agreement for the deal planned with the US, Yechury said adding that the government must share all its discussions with the IAEA too.

On the US state department`s report on Human Rights issue, the CPI-M leader said Nandigram has been singled out though America was silent on the situation in several other parts of the world including Iraq and Israel.

Stating that the report has been condemned by all, he said internal affairs within India would be settled internally and there should not be interference by the US.

Claiming that there was a `grand alliance` against the CPI-M on Nandigram issue, Yechury said starting from NGOs to the US and Congress leaders to RSS and BJP were together over this issue. "It demonstrates how important CPI-M is," he said adding the party was the biggest victim of violence in Nandigram where many were killed and thousands evicted.

On the third political alternative, he said CPI-M was trying to bring together like-minded parties on issues like secularism, `anti-people` economic policies of the government and sovereignty and independent foreign policy.