Business-news- at Simplenewz your social news reader

simpleNewz

your social news reader

Find and read news in one place.
Share and comment the news you love.
Travel back in "news time".

Business News
for 05/19/2012

(last updated 7:30am EST 05/19/2012)

Custom Search

• Romney's saccharine side peeks out in ne... Romney's saccharine side peeks out in new ad envisioning a Mitt presidency
05/19/2012
In his first official ad of the presidential election campaign, the presumptive Republican candidate seeks to remould his image Who Mitt Romney has not had the easiest time of it. A brutal and bruising GOP primary campaign has finally left him in pole position as the presumptive nominee. But it has also left him "severely conservative" (to use his own words) and battling a common public image as an uncaring capitalist robber baron who likes to fire people for kicks. So how does one launch one's national campaign? With a massive rebranding effort, of course. What Day One is the first ad from the Romney camp since former Pennsylvania senator Rick Santorum dropped out and thus represents Romney's first real attempt to sell himself to the whole nation, not just potential Republican caucus/primary voters. As a result, the 30-second TV spot is a rare beast: a positive ad designed to inspire and make you feel good about His Mittness' vision of America. When The ad is going up in the next few days. Its positive nature is aimed at reflecting the fact that it is an official campaign ad, unlike some of the nastiness that so often emerges from Super Pac ads. In a week where Romney-supporting groups apparently toyed with playing the race card by emphasising President Barack Obama's former pastor Rev Jeremiah Wright, this Romney ad is all about being Mr Nice Guy. Where As usual, this ad is targeted at some key 2012 battlegrounds. The campaign has bought air time in Ohio, Virginia, North Carolina and Iowa. All these states are in the centre or the centre-right of the battleground. That means this ad seems to be aimed at shoring up Romney support or going after soft right independents. How Welcome to the world that exists inside Romney's head when he lies down to go to sleep at night. "What would a Romney presidency be like?" the ad ponders as it opens with footage of a beaming, craggy-jawed Romney looking distinctly presidential. The voiceover man is not one of those gravelly-sounding gentleman from attack ads who sound like they also do trailers for slasher films. He sounds pleasant and reassuring, almost in a kindly father figure sort of way. Then, to a jaunty soundtrack, the ad proceeds to answer its own question. "Day one: President Romney immediately approves the Keystone pipeline creating thousands of jobs that Obama blocked," it announces. It goes on: "President Romney introduces tax cuts and reforms that reward job creators." That really is meaningless boilerplate but it plays over images of hardworking business folk, a combine harvester in a vast field of grain and then – slightly incongruously – an attractive young black woman who gives the camera a sly smile. Finally it tackles healthcare reform in yet another sign that the Romney camp is confident that Obama's biggest single domestic achievement is in fact a winner for the Republicans. "President Romney issues orders to begin replacing Obamacare with common sense healthcare reform. That's what a Romney presidency will be like." No mention there that Obamacare was inspired by Romney's own efforts at healthcare reform in Massachusetts. But it always bears repeating: no one looks to political ads for truth or fairness. That's not their point. Instead one should be noting the repeated use of the words "President Romney" and "Romney presidency" and the use of the words "will be like" not "would/could be like". At a time when there is a growing "nasty Mitt" meme in American public opinion this ad is a dose of pure sugar aimed at reassuring people Romney is a decent all-American type of politician. It aims to slay the image of Ogre Mitt and replace it with Saccharine Mitt. US politics Republicans Mitt Romney Advertising Obama administration Oil US elections 2012 Super Pacs Paul Harris guardian.co.uk © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds (1 h ago)

• Angela Merkel caught in referendum row w... Angela Merkel caught in referendum row with Greece
05/18/2012
Greece claims German leader advised it to hold a referendum on euro membership – but her spokesman denies allegations German-Greek relations were further strained on Friday after the German chancellor, Angela Merkel, was heard advising Greece to hold a referendum on its membership of the euro. Greek politicians reacted angrily, but Merkel's aides insisted she had not suggested a referendum during a telephone call on Friday with the Greek president, Karolos Papoulias. The Greek government's spokesman, Dimitris Tsiodras, said: "[Merkel] relayed to the president thoughts about holding a referendum in parallel with the elections on the question whether Greek citizens wish to remain in the eurozone." A German government spokesman rejected the idea that Merkel had proposed a referendum. "This is false and we completely dismiss this," he said. Some commentators suggested that the misunderstanding was due to an error in translation. One said that Merkel had said that the 17 June elections in Greece would be like a referendum on the country's membership of the euro. But Greek politicians criticised Merkel's perceived interference in Greek affairs. Alexis Tsipras, the leader of the leftwing Syriza party that wants to renegotiate Greece's bailout by the EU and the IMF, said: "Ms Merkel is used to addressing Greece's political leaders as if the country was a protectorate." Antonis Samaras, a conservative, also criticised Merkel's suggestion. "The Greek people don't need a referendum to prove they're pro-euro. Her idea is unfortunate, to say the least, and can't be accepted," he said. The elections will take place amid confusion in Greece over which economic path to take. Opinion polls suggest that Greeks want to remain in the euro but do not want to abide by the austerity programme demanded as part of the international deal to finance Greece's debt. Merkel and other European leaders have told Greece they must continue the austerity programme if they want to remain in the single currency. Greece Angela Merkel Germany Euro European Union European monetary union Economics Currencies Euro Eurozone crisis Financial crisis Conal Urquhart guardian.co.uk © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds (1 h ago)

• The eurozone crisis: five ways it affect... The eurozone crisis: five ways it affects you
05/18/2012
From pensions and savings to holidays, we look at how the latest market turmoil will impact on your finances 1 Your pension If you are retiring this year Greece has been very, very, bad news for you. There is an ongoing slow-motion collapse in annuity rates, and this week it got a little worse. When a man aged 65 swaps £100,000 in his pension pot for an annuity – a regular monthly income for the rest of his life – the sum will be just £6,000 a year. That compares with the £14,000 a year that someone retiring in 1990 earned from a savings pot of £100,000. If the pensioners wants to build in 3% a year cost-of-living increases into the annuity, the rate he'll get for that £100,000 will be a paltry £4,150 a year. But why blame Greece? Because the surprise status of the UK as a "safe haven" for international money during the crisis has pushed the interest rate on government bonds (known as gilts) to historic lows – and the price of gilts has a strong influence on the price of annuities. This week the return on 10-year bond yields, which reflect the cost of borrowing by the government, fell to 1.87% as investors fearful of the enveloping euro crisis reduced their lending to Spain and Italy in favour of the UK, Germany, the US and Japan. The fall in gilt yields this week beat the previous low of 1.92% in January, and is the lowest level since Bank of England records started in 1703. This week Canada Life cut annuity rates, and others are expected to follow, says Billy Burrows of Better Retirement Group. "It's another nail in the coffin for UK savers. The retired have been paying the price for the banking crisis through lower savings rates, now people reaching retirement are paying the price for Greece." What's more, the outlook for men is much worse for women – because on 22 December an EU directive will force pension companies to equalise annuity rates between males and females. Men, who suffer shorter longevity than women, receive better annuities as a result, but after 22 December these will be cut, while those for women will be increased. The options for those approaching retirement are grim; work for longer and defer retirement (and if you get ill in the meantime, there's the silver lining of better rates as the insurer assumes you'll die earlier) or buy a temporary annuity. These can be bought for a fixed period, usually with a minimum of five years and a maximum of the period until age 75 is reached. But as Gemma Goodman of annuity brokers Alexander Forbes says, there is no guarantee it'll be better value; at age 75 annuity rates may be even lower. A PricewaterhouseCoopers report this week suggested that babies born today may have to work until 77 before they qualify for a state pension. Given the ever-shrinking value of annuities, it may be worth younger adults considering alternative ways of saving other than a pension – such as Isas or property – where you do not have to buy an annuity at retirement. 2 Your investments The stock market continues to fall heavily in response to the Greek crisis, with speculators assuming a disorderly default, and its hit on the banks could lop as much as 5% off the GDP of Europe. The FTSE has lost 1,090 of its value since it hit a high of 5,965 as recently as 16 March, wiping £190bn off the value of the UK's biggest companies, much of it still held in pension funds. Investors who have stock market-based Isas invested in Europe have fared a lot worse. Over the past year some giant funds have lost as much as a quarter of their investors' money. Invesco Perpetual European Equity, a £1bn fund, is down 26%, while the £200m Artemis European Growth fund is down 25.8%. Even over five years the average fund invested in Europe has managed to lose 16.5%, with some down as much as 40%. There have been few safe havens from the Greek crisis. Gilts have had, once again, a good crisis. The average UK gilts fund is up 4.8% over the past three months, and investors who have held for the past five years are enjoying gains of 58%. Most corporate bond funds have also held their heads above water, but almost everything else has been in negative territory. Interestingly, China has been worst, performing even more poorly than mainland Europe. Analysts say that when investors become risk-averse money pours back into safer territories, leaving emerging markets exposed. But gold has been the odd man out during the latest phase of the Greek tragedy. Its price this week dropped to about $1,530 an ounce, its lowest level for nearly nine months, and 20% below its $1,895 high in early September 2011. Investors have preferred the safety of US dollars and US treasury bonds to the traditional safe harbour of gold. Some people also argue that in times of extreme economic stress investors sell gold to get their hands on cash. The good news is that virtually all commodities have fallen back in price in recent months, although that has as much to do with softening of the Chinese economy as problems in Europe. Since September wheat is down from $8 a bushel to $6, coffee is down from $2.80 to $1.77 a pound, and sugar has fallen from $850 a tonne to $570. Whether we'll see these falls reflected at Sainsbury's or Tesco is another matter. Meanwhile, copper thefts from Britain's railways should become less attractive; the metal is down in price from $9,600 a tonne last July to $7,700 this week. 3 Your savings and mortgage Relief for savers suffering from paltry returns on their building society accounts remains as far away as ever. The latest fall in gilt yields brought by the Greek crisis will help keep interest rates in Britain low for longer than anyone imagined back in 2009 when Bank of England base rate fell to an historic low of 0.5%. Savers who want a better return on their cash may have to start considering riskier alternatives – such as "retail bonds" from the likes of Tesco, which, although not offering any guarantees under the government's compensation scheme, pay interest of 5%-8% a year. There's better news for mortgage holders, though – except those on pricey long-term fixes. Last week the latest meeting of the Bank of England's monetary policy committee kept interest rates on hold once again, and economists are virtually united in forecasting near-zero rates through to 2014. "Interest rates seem set to remain at their current level of 0.5% until at least late 2013 and very possibly into 2014. Interest rates are clearly not going to be raised for some considerable time to come given the fragility of the economy and the need to counter extended tight fiscal policy," said Howard Archer of IHS Global Insight. The outlook suggests that those on existing tracker mortgages or low-standard variable rates – such as Nationwide's 2.5% base mortgage rate – should cling on for as long as possible. For new buyers the best tracker rates are on offer from First Direct, which has a mortgage that tracks the Bank's base rate plus 2.39% for life, giving a rate of 2.89% for now. However, it is only available to those able to put down a deposit of at least 35%, and comes with an arrangement fee of £499. If you can only afford a 15% deposit HSBC's tracker at 3.99% is top of the table. It has no arrangement fees. 4 Your car The problems in Greece are at least providing some relief to motorists, with fears of slowing global economic growth pushing the oil price down substantially over the past six weeks. In mid-March Brent crude was selling for $125 a barrel, but this week it fell to a six-month low of $108 amid renewed concerns that a breakup of the euro would send economic shockwaves around the world. The fall has sparked a price war at the supermarket petrol pumps, with Asda cutting its prices four times over the past four weeks. On Tuesday this week Morrisons cut its price to 132.9p for unleaded and 137.9p for diesel. Then on Wednesday Asda undercut Morrisons, offering unleaded for 0.2p less at 132.7p. The price reductions mean the cost of unleaded is now 8p below its March peak. Asda said it "always aims to lead the way when we get the chance to cut prices because of a drop in the global cost of oil," and took a swipe at rival supermarkets, which vary their petrol prices around the country. "Unlike other retailers we do everything we can to reduce prices for all of our customers wherever they live. Research taken from PetrolPrices.com shows some retailers get away with charging their customers more for fuel – as much as 8p a litre more – in towns without an Asda nearby." According to PetrolPrices.com the average price for a litre of unleaded in the UK is 138.1p, but some petrol forecourts are charging as much as 155p a litre. However, prices will nudge back up again in August with the 3p rise in duty announced in the budget. 5 Your holiday Most holidaymakers heading to France, Spain or Italy will benefit from the euro's slide against sterling, falling to €1.25 this week and with some currency experts forecasting further declines to €1.30. But what if you are heading for a fortnight on a sunny beach on a Greek island, only to find that the country has crashed out of the eurozone? Will your holiday be at risk? Bob Atkinson of travelsupermarket.com says: "The issue will be around how your tour operator interacts with the hoteliers in Greece, and what the terms of their contracts say. They should all have plans in place that will allow you to continue with your holiday. But what if the hotelier has gone bust? "If you have booked an Atol-covered package your tour operator is obliged to organise alternative accommodation, or if there is no immediate alternative, a holiday on a different date or a full refund. "If you have booked independently, you may still be covered provided you paid by credit card and the deposit was £100 or more, you paid by Visa or MasterCard debit card (and can do a charge-back), or have travel insurance which includes end-supplier failure in its cover," says Atkinson. He recommends that Greek-bound travellers hold off buying euros until the last minute. "Unless the whole banking system goes into meltdown you are also likely to be able to use credit and debit cards, although it's impossible to say which currency your transactions will be made in until it actually happens." Brits with holiday homes in Greece, and an account at a local bank, would be wise to swap their euros for sterling. That probably also applies to ex-pats in Cyprus, which is independent of Greece but whose banking system is closely entwined with the country. In the worst case (and still highly unlikely) scenario – contagion from a Greek collapse across to other Mediterranean countries such as Spain and Portugal – British retirees abroad will want to make sure they have very little of their assets deposited in local banks. Family finances Pensions Savings Mortgages Isas Banks and building societies Investments Foreign currency Eurozone crisis Euro Euro Patrick Collinson guardian.co.uk © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds (1 h ago)

• Euro crisis: Is Cyprus next for the Grex... Euro crisis: Is Cyprus next for the Grexit?
05/18/2012
Cyprus, with its out-sized banking sector equal to 835% its GDP, could be the next knock-on from the Greek euro crisis One of the mysteries of the Greek financial crisis is that there are any deposits left in the stricken country's domestic banks. Since 2009, it's estimated that €2-€3bn has been withdrawn from Greek banks every month. The pace has picked up markedly in recent days; on Monday alone €700m was taken out of the banks, and the Greek president told reporters: "The strength of banks is very weak right now." A friend recently returned from a 600km trek across the countryside outside of Athens. Many roadside shops and restaurants were abandoned or locked. Locals were not willing to accept cards. Everything had to be in cash, and she sensed a fear that money tied up in the banking system would be lost should it go into meltdown. Yet according to Greece's central bank, total deposits held by domestic residents and companies stood at €165.36bn in March. Given the likely sequence of events should Greece leave the euro – accounts frozen, converted into new drachmas and then devalued by around half – it's extraordinary there is any money on deposit at all. I can add little to the pundits speculating whether there will be a "Grexit". But the lack of focus on Cyprus is surprising, especially given the 80,000 Brits living there. It is, of course, an independent country with its own central bank. A blog for British residents I read this week tried to calm fears about a knock-on from Greece, claiming the island has a robust deposit protection scheme. So did Iceland. Cyprus's out-sized banking sector is equal to 835% of the island's GDP, says the FT. More worryingly, the operations of the Cypriot banks in Greece alone are equal to 130% of Cypriot GDP. Some claim the island has benefited from flows out of Greece. But when one of the country's leading banks this week required a £2bn cash injection, it doesn't ring true. Economists who talk about contagion from Greece always point to Spain and Portugal. But surely it will be Cyprus next? And if the British in Cyprus have sense they won't rely on articles extolling the island's deposit protection scheme – although savers here with the Bank of Cyprus (UK) are covered by Britain's compensation scheme. Consumer affairs Cyprus Eurozone crisis Euro Financial crisis European monetary union Patrick Collinson guardian.co.uk © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds (1 h ago)

• Abundance – Small business, big idea Abundance – Small business, big idea
05/18/2012
Founder Karl Harder's 'democratic finance' means anyone with £5 can invest in renewable energy projects Name Abundance Generation Founders Karl Harder, Louise Wilson, Bruce Davis Company started Abundance was founded in Oct 2009 but has only been authorised and regulated by the Financial Services Authority since July 2011 Number of employees 7 full-time staff plus a "very able" team of creatives, lawyers and renewable energy experts who work on specific deals Based in Shepherds Bush What's the big idea? Harder calls it "democratic finance" – allowing anyone to invest directly in renewable energy projects in the UK with a minimum £5. He says: "We want to give back to people control over where their money is invested and how it generates a return. Renewable energy is the starting point, but we believe that democratic finance could be a more sustainable source of finance for other forms of public infrastructure investment such as schools, hospitals and social impact initiatives." What do they do differently? Harder says all investors, whether they are small or big, get access to the same opportunities and same levels of service and customer experience. "The minimum £5 investment is unique in the market," he adds. The website provides a direct connection with the projects customers invest in, providing live information about the energy produced, the weather at the site and the expected return investors are earning. How did it come about? Davis was involved in the creation of the world's first peer-to-peer lending site, zopa.com, and was working as an anthropologist studying money and our usage of it in everyday life. By chance, he bumped into Harder in the British Library, the two began chatting over coffee, and Harder soon found himself talking about how to find ways of involving communities in funding renewable energy projects. Wilson came on board, and three years later, the team created the final model and produced something that Harder says is "truly radical in its approach compared to more conventional forms of investment". Its lead investors are NESTA – a charity whose mission is to "help people and organisations bring great ideas to life" – and Panahpur, a social investment foundation created in 1907 as a community for orphaned children. Who are their clients and how do they work with them? Companies such as The Resilience Centre in the Forest of Dean. They are developing community renewable energy projects and are looking for ways to involve the wider community locally and nationally in funding the project, as well as getting a return based on the money made from generating and selling green energy. How is the business plan going – and where do they hope to be in five years? "We are working with a number of companies who have projects including wind, solar, hydro and anaerobic digestion technologies which will be available very soon through the website," Harder says. Unfortunately, the first project – the Resilient Energy Great Dunkilns – has been delayed due to problems with the supply of the wind turbine. This meant the offer had to be suspended until the issues are resolved and all cash invested returned to customer accounts. Davis says it is "disappointing and frustrating when we had gathered such a great and supportive group of investors", but he remains confident. Their killer advice for new start-ups Harder says: "The true measure is not how slick the business plan looks, but how well the team responds and supports each other when the inevitable challenges arise from trying to do something that is genuinely different, and ground-breaking. And it is overcoming those challenges, and building goodwill from customers, that makes it all worthwhile." Ethical money Work & careers Renewable energy Investing Investments Mark King guardian.co.uk © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds (1 h ago)

• What I'm really thinking: the call centr... What I'm really thinking: the call centre worker
05/18/2012
'I create pictures of you in my head; imagine the type of house you live in, what sort of life you lead' I hear a high-pitched beep in my ear as your call comes through. This is my cue to put down my book and load up your details on the screen in front of me. It's often your cue to get frustrated with my repetitive data protection questions. "Project your smile down the phone" and, "A customer's first impression is formed after the first seven seconds" are the clichés drummed into me. Maybe they're right. But my judgment is made sooner. You're the brash male who realises you're asking a girl half your age for technical support. I marvel at your embarrassment, as you adopt the strandoffish approach. You race through what I am advising you to do, forgetting that I am in fact the one who is likely to know more about the workings of your TV with a screen size almost as big as your ego. Five minutes later, you're the elderly woman who's baffled by technology. You say that I am an "angel", telling me how clever I am for managing to retune your TV so you won't miss Countdown after all. Little do you know, I have the user manual loaded up and am doing no more than you could have done if you had only read it yourself. I create pictures of you in my head; imagine the type of house you live in, what sort of life you lead. You probably create an image of me – the poor girl, just one small cog in a large corporate wheel. The thing is, the job's not bad, your stories make for good anecdotes, oh, and I'm going back to university next week. • Tell us what you're really thinking at mind@guardian.co.uk Call centres Work & careers Anonymous guardian.co.uk © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds (2 h ago)

• HomeServe took insurance payment after w... HomeServe took insurance payment after we had cancelled our policy
05/18/2012
We told HomeServe we didn't want to renew our insurance policy, but it took money from our credit card anyway My husband and I had an upsetting experience with HomeServe last April when we had a significant water leak on our driveway. As a result, we decided we would not renew our insurance policy with the company. When the renewal came up in April, my husband wrote to HomeServe cancelling the policy, and instead of sending it freepost as instructed in their renewal letter, he sent it recorded delivery and kept a photocopy. HomeServe acknowledged receipt of the letter but took the money from his credit card anyway. Although I think this amounts to theft, our daughter, who teaches law at a local college, says it is a civil matter and we will have to reclaim the money through the small claims court. Surely we can't be the only ones affected by this policy? RT, Kingswinford, West Midlands This is turning into something of an annus horribilis for HomeServe. Back in November 2011 the company shocked investors and customers by suspending its entire sales workforce for several weeks amid fears they had been mis-selling its products. Then it emerged that a whistleblower who worked for the West Midlands-based firm had told the Financial Services Authority that the company had been ignoring complaints by customers it had let down during the previous very cold winter. If that wasn't enough, a few weeks ago HomeServe was fined £750,000 by the media telecoms regulator Ofgem for making silent (or abandoned) sales calls to customers. You have to wonder what's going at the firm, which insures over three million people in the UK against burst pipes, broken gas boilers and electrical problems. The fact that it took your money, even though you had told it you were not renewing – and sent it recorded delivery – is hardly surprising given what else has been happening, and it is not a good sign. Happily, your complaint was easily resolved. HomeServe has thanked us for "bringing this to our attention". The company says the money has now been refunded to your credit card. It has also sent you a further £150 in relation to the matter that caused you not to renew in the first place – the repair to a main leak on your drive. We welcome letters but cannot answer individually. Email us at consumer.champions@guardian.co.uk or write to Bachelor & Brignall, Money, the Guardian, 90 York Way, London N1 9GU. Please include a daytime phone number Home insurance Insurance Consumer affairs Consumer rights Homeserve Miles Brignall guardian.co.uk © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds (2 h ago)

• Facebook is now priced for perfection | ... Facebook is now priced for perfection | Brent Hoberman
05/18/2012
The weight of the world is now on Zuckerberg's shoulders. As co-founder of Lastminute.com, I can, in a small way, empathise I can't claim to have had anything like the success of Mark Zuckerberg, but as Facebook floated on the Nasdaq stock exchange today, I could empathise in a very small way with what its founder must be feeling. In March 2000, following a period if intense media interest, my own company, Lastminute.com , went public, and was priced the day Nasdaq peaked, at £571m. It increased its price during an accelerated road show by more than any other European initial public offering (IPO). The thinking then was technology IPOs were like Giffin goods – the more expensive, the more demand. Facebook is at a different stage. Back then, the internet had very few profitable giants. We were loss-making and had the revenues, as one analyst wisely pointed out, of a small pub. Facebook is very profitable, making $1bn last year, and has jaw-dropping reach. Its execution has been almost flawless (excluding the occasional privacy lapse and mobile) and it is now valued at more than $100bn – 100 times greater than our business. Yet there are superficial similarities. Both had young founder chief executives. I was 31 when Lastminute.com went public (old by today's standards: my co-founder Martha Lane Fox was 28). I had very little real idea of what to expect from investors and of managing large teams and crazy growth. Zuckerberg has had eight years to build a world-class, experienced team around him. Facebook has the benefit of the pioneers that have gone before it, they have lowered the costs of web technology dramatically and given a new generation digital management experience. Zuckerberg is in the mould of Jeff Bezos of Amazon , Steve Jobs of Apple , and Google's Larry Page – an idealistic, passionate, driven, impatient, obstinate, obsessive CEO, who can drive a team to long-term rather than short-term goals. He will have 57% voting control – Martha and I had no control, and were never advised about the possibilities of such things as " dual-class voting stock ". But, like Facebook, our business was a hot stock that was chased up by retail investors. We saw how this creates real stress. People bought into our business at a high valuation and believed it could only go one way. Investors see this as free money, and if it isn't (in our case the bubble burst and the stock went down 95%, until we recovered) then sentiment changes fast. In such situations, motivation has to come from the team around you, from growth and the love of customers for your product – you cannot depend on support from critical investors and an increasingly cynical media. Despite the massive boost to his personal wealth, which is now valued at $25bn, there are things Zuckerberg will hate about going public: the results, saying the same thing over and over again to investors when he would rather be driving the business; the market sentiment that will make his stock a hedge fund plaything. He will hate being asked about the share price, as if he controlled that too. He will hate people who want him to focus on short-term profits as opposed to his long-term mission. He will probably hate having to worry about how to invest his money, as that doesn't seem to drive him except as a way of keeping the score. Investors, in turn, should look for Zuckerberg to keep his confidence – not arrogance. For the valuation to double over five years (the sort of return investors need to believe in) they will want him focused. He will need to demonstrate that with his fantastic war chest and user base he can take the business into mobile phones, payments, identity, big data analytics, social commerce … In a similar way the lastminute.com IPO valuation was based on a belief that the business was not about selling low-margin cheap flights but would continue its expansion into a greater share of customers' leisure spend across different devices and into different nations. The night we went public and raised £120m, Martha and I were very subdued. It felt as if we had the weight of the world, and our employees, on our shoulders, and that the company was priced for perfection. That was massive pressure. However, now I look at Zuckerberg and see someone who really does have the weight of the world on his shoulders, is only 28, and doesn't have a proper business partner. I had hoped Facebook would resist the temptation that we also felt, to raise the price too much. In our case I'm not sure the added pressure was worth it, and in theirs they really don't need the extra money. I suspect Zuckerberg will feel that pressure, that his world is surreal. But he will be happy that he has been given this chance to continue to change the world – and follow his passion. And that his creation's future is assured for some time to come. Facebook Internet Mark Zuckerberg Social networking Nasdaq Stock markets United States Brent Hoberman guardian.co.uk © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds (2 h ago)

• The Jamaicanisation of the eurozone | Ma... The Jamaicanisation of the eurozone | Mark Weisbrot
05/18/2012
By imposing budget cuts and austerity, the ECB is condemning countries like Greece and Spain to an economic twilight zone Jamaica, an English-speaking Caribbean island nation of 2.9 million people, may seem worlds away from Europe. The country's income per person of $9,000 ranks it 88th in the world, as compared to the eurozone countries, which are three or four times richer. But they face a common problem, and although none of the eurozone countries is likely to become as poor as Jamaica is today, they could easily – going forward – mimic the dismal economic performance that Jamaica has seen over the past 20 years . Jamaica has the world's highest public debt burden: interest payments on the government's debt account for 10% of the country's national income. (For comparison, Greece – with the worst debt burden in Europe – is paying 6.8% of GDP in interest.) This leaves little room for public investment in infrastructure, or improving education or healthcare. Partly as a result of this debt trap, Jamaica's income per person has grown by just 0.7% annually over the past 20 years. Two years ago, Jamaica reached an agreement with its creditors, brokered by the IMF, that restructured its debt. Interest payments were lowered, and some principal payments were pushed forward. But the debt burden remained unsustainable. The IMF now projects that Jamaica's debt will reach 153% of GDP in just three years. Sound familiar? That is what happened to Greece just four months ago. The Greek government reached an agreement with the European authorities (the "Troika" of the European Central Bank or ECB, the European Commission, and the IMF) that reduced its debt. Unlike in Jamaica, the private investors holding Greek debt took a "haircut", losing about half of the principal. But still, it wasn't enough. Before the ink was dry on the deal, an IMF estimate of a "pessimistic scenario" going forward showed Greek debt reaching more than 160% of GDP by 2020. Since the IMF's projections for Greece over the past few years have proved enormously over-optimistic, and with Europe sliding further into recession, the pessimistic scenario is the more likely one. This means that even if Greek voters end up with a government that accepts the agreement – by no means guaranteed – it is likely that their economy will limp along from one crisis to the next until there is another restructuring, or a chaotic default. In both Greece and Jamaica, the problem is not just the debt itself; even more, it is the policies that the creditors have attached to further lending. In Greece, this is extreme: the Troika insisted on Greece cutting 8.6% of GDP from its fiscal deficit over the past two years – the equivalent of the United States wiping out its entire federal budget deficit of $1.3tn. Naturally, the economy went into a tailspin. In Jamaica also, the IMF attached conditions during the 2008-2009 economic crisis that worsened the country's downturn. Europe's problem with harmful policies attached to official lending is not limited to Greece. Dow Jones' recent headline tells the sad story of Portugal in a sentence: "EU: Portugal Will Need More Austerity To Meet Deficit Targets." Yes, the European Commission wants Portugal to make even bigger budget cuts because the ones they already made have shrunk the economy so much that they won't make their target deficit-to-GDP ratio. The economy is projected to shrink by a painful 3.3% this year, and official unemployment has risen from 12.9% last year, to 15.3% this. Ireland is in recession, yet it, too, is engaging in big budget tightening. Spain hasn't yet had to borrow from the Troika, but has followed the same policies. With more than half of its youth languishing in unemployment, Spain's fiscal tightening – according to the government's projections – will carve 2.6% out of its economic growth this year. Of course, there are many important differences between the situation of the eurozone countries and Jamaica, and among the eurozone countries themselves. Jamaica needs debt cancellation; some of the eurozone countries in trouble – for example, Spain – would have a sustainable debt burden if the ECB would simply intervene in the sovereign bond markets and guarantee a low interest rate on their bonds. And the ECB, as the issuer of a hard currency in a monetary area with no serious inflationary threat, has a lot of room to do whatever is necessary to make sure that all of the eurozone countries have low borrowing costs and therefore sustainable debt. But the ECB has refused to use its powers to put an end to the sovereign debt crisis, preferring instead – hand-in-hand with the rest of the Troika – to exploit it in order to force unpopular political changes in eurozone countries, especially the weaker ones. In so doing, they are condemning these countries to the long-term stagnation of high unemployment and slow growth that Jamaica has suffered for the past two decades. Although the human costs are much higher in a developing country such as Jamaica, this still entails a huge amount of unnecessary suffering on both sides of the ocean. Eurozone crisis Jamaica Debt relief Greece IMF Economics European Central Bank European Union Mark Weisbrot guardian.co.uk © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds (2 h ago)

• Facebook narrowly avoids dip below start... Facebook narrowly avoids dip below starting price in mixed first day of IPO
05/18/2012
Social network giant ends day at $38.23 (£24), up just 0.61% from its starting price after share sale got off to a messy start Facebook's first day as a public company ended with the company narrowly avoiding the embarrassment of its stock dipping below the $38 (£24) starting price, in one of the most frenzied share sales in history. Shares in the social network giant ended the day at $38.23, up 0.61%, having soared 11% earlier in the day. A record 566m shares traded hands as the company joined the Nasdaq stock market where it is now valued at $104bn, more than the combined worth of Goldman Sachs and Nike. Mark Zuckerberg, the company's 28-year-old founder and Facebook's largest shareholder, saw the value of his holding reach $20.4bn by the time the market closed. The sale got off to a messy and inauspicious start. Early trading was delayed until 11.30am as the exchange systems seemed unable to cope with the scale of the initial public offering (IPO) and failed to send electronic reports back to traders and firms to confirm that shares had been bought or sold. After the market closed, CNBC reported that the Securities and Exchange Commission was looking at the Nasdaq trading problems. When trading eventually did start, more than 82m shares were traded in the first 30 seconds. The share price soared 11% before quickly collapsing to close to the $38 offer price. Dealers speculated that Facebook's army of bankers had stepped in to stop the shares falling below $38, a move that would have landed the social network with a public relations disaster on its first day as a public company. Sam Hamadeh, founder of the analyst PrivCo, watched the day unfold at the Nasdaq exchange. "It was stunning," he said. "I have not seen anything like it in 20 years of watching this market." He calculates that the banks who underwrote the share sale stepped in and bought $300m worth of shares to stop Facebook dipping below $38, a move that would have marked Facebook as a "busted IPO". "It doesn't matter so much to Facebook, they raised their money but it's not a great start," said Hamadeh, who said he believed Facebook was worth $24-$25 a share. "And that's being generous." Before the shares started trading the estimated price reached $45, triggering a wave of sell offs that Nasdaq could not handle, said Hamadeh. Nasdaq did not return calls for comment. He predicts that the shares will fall further next week. "The banks can't support this thing forever," he said. For now the share price is not Zuckerberg's primary concern. "Of course the money means something to him," said David Kirkpatrick, author of the Facebook Effect. "But he's not doing it just for the money and he assumes that rather than focus on the money, he should focus on making sure Facebook does well. He is highly analytical in everything he does, extremely disciplined. He is not going to be watching that stock price every day, I can tell you that." Facebook's stock market debut had begun with Zuckerberg - wearing his trademark navy blue hooded top - remotely ringing the opening bell for the New York-based stock exchange from outside his California headquarters as staff cheered him on. Forbes calculated that as he did so, he was the world's 23rd richest man – two places above Google founders Larry Page and Sergey Brin. However, the riches generated by Facebook went wider. At $38 a share Facebook created 88 people with fortunes of over $30m, according to Wealth-X, an analyst that monitors high net worth individuals. If the price reaches $43, there will be 265 Facebook millionaires worth more than $30m. The sale reaped enormous rewards for Facebook's co-founders and early backers. Co-founder Dustin Moscovitz is now worth over $5bn. Elevation Partners, an investment firm that counts U2 singer Bono among its partners, holds shares worth over $1.6bn. Facebook's IPO is the most hotly anticipated share sale since Google's in 2004. Google's stock started trading at $85 and ended the day at $100.34. Google's shares now sell for over $620. As with the Google IPO, there has been a lot of scepticism about Facebook's ability to turn its phenomenal number of users into a business able to support a $100bn-plus valuation. Facebook's revenues were $3.7bn last year. Goldman Sachs, the investment bank, had revenues of close to $29bn and is valued at half Facebook's current value. The social network now has over 900 million people on its service and will soon top a billion. For its fans, Facebook is the defining company of the 21st century. "His impact on the world will be as least as big as Bill Gates and probably already has been," said Kirkpatrick. Kirkpatrick has spent many hours with Zuckerberg writing the only authorised history of the company. He said Zuckerberg had a "laser focus" on business and planned to spend Friday working rather than watching the share price. "He really doesn't believe in paying attention to that stuff. He's much more focussed on product development, on penetration of the service around the world," said Kirkpatrick. The sale comes amid what some are calling a new bubble in tech companies. Facebook's IPO follows a mixed set of share sales from other social media firms including Groupon, the online coupon company, and Zynga, the games firm behind Words With Friends and Draw Something. Facebook itself has driven up the bubble, according to some, by spending $1bn on Instagram, a profitless photo-sharing application. Earlier this week Pinterest, a social site that lets people "pin" pictures and content to create collections of interest, raised $100m at a price that valued the company at $1bn. "There is a frenzy going on. I think this is a bubble," said Alan Patrick, co-founder of technology consultancy Broadsight. "Short term I can see that Facebook can be valued at $100bn on sentiment. People believe that it is going to make a lot of money. But sentiment doesn't last." He said Facebook had yet to prove that it could make money on mobile devices, the fastest growing way in which people access Facebook. However, the share sale comes in a week when General Motors announced it was dropping its own Facebook ads and said they were not working. GM is one of the world's largest advertisers and spent $1.83bn on US ads last year, according to Kantar Media, an ad-tracking firm. Nigel Morris, chief executive of ad giant Aegis Media Americas, said: "We handle a number of clients who are advertising very successfully on Facebook. For others we are evaluating the right approach. The issue for Facebook is not whether revenues will grow, it's whether they will grow fast enough to justify this valuation." Whatever the future for Facebook, its founders and early investors were certainly celebrating. Co-founder Eduardo Saverin, who is now worth over $2.7bn, congratulated Zuckerberg on his Facebook page: "Congrats to everyone involved in the project from day one till today, and I especially wanted to congratulate Mark Zukerberg (sic) on keeping tremendous stead-fast (sic) focus, however hard that was, on making the world a more open and connected place." Facebook Nasdaq United States Social media IPOs Internet Internet IPOs Stock markets Dominic Rushe guardian.co.uk © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds (2 h ago)

• Facebook IPO: an anatomy of Wall Street ... Facebook IPO: an anatomy of Wall Street overreach | Heidi Moore
05/18/2012
Before trading, Facebook's bankers were ready to count their profits in billions. By close, they'd had to bale out their own IPO The day of Facebook's first day of trading as a public company brought with it a strange perspective: the highest manifestation of a social media bubble and its ugly aftermath, all in the span of a few hours. Who would have thought that Facebook's much-hyped IPO – in its bold $16bn size, the apotheosis of uncontrolled, frothy, capitalist ambition – may have been just the thing needed to bring Silicon Valley high spirits back down to earth and send ambitious techies snuggling back into their hoodies? The day opened with crowds awaiting Facebook's debut in New York's Times Square , waving at cameras. Gleeful Facebook employees, with sugar-plum dreams of newly-minted fortunes , crowded with smiles behind CEO Mark Zuckerberg at the company's Menlo Park headquarters. The Wall Street Journal created a Zuckerberg Wealth-O-Meter ($20bn at the latest count) and the New York Times revealed the subtle-wealth secrets of 1,000 new millionaires created by the IPO . Just to play a concise version of the parlor game that went around the stock markets, Facebook's market value at $104bn – with $3.7bn of profits – would have made Facebook worth more than: internet megastore Amazon.com; global beverage behemoth PepsiCo; petro-giant Total; BHP Billiton; and McDonald's. It was not far off the valuation of JP Morgan Chase, an international bank with $1tn in assets. Over the previous weeks, one brief glimpse of Mark Zuckerberg in a hoodie, heading to an investor meeting, launched the kind of press coverage we've hardly seen since the Beatles. JP Morgan itself, one of the company's banks, flew the Facebook company flag next to the stars and stripes of the United States, and papered its headquarters with Facebook signs. One was tempted to caption many of the pictures, media packages and general euphoria with a single sentence: "On the sixth day, He created Facebook." It was a vision of capitalist paradise, all the richer because Zuckerberg openly disdained the money-waving bankers and investors of Wall Street. What could possibly go wrong? The popping of this culturally focused Facebook bubble – if not the financial one – was decisive. A few hours later, the scene was decidedly more morose. The IPO was delayed three times on the Nasdaq exchange because of technical difficulties. Facebook's stock price began a determined move downward – until its 33 banks rushed to buy up shares to avoid embarrassing the company. Zynga, the publicly traded company that makes Farmville and contributes 12% of Facebook revenues, took the aftershocks from Facebook's struggle strongly: its stock fell so fast that its trading was halted. Financial television pundits turned tail and suddenly cautioned against putting faith in an irrational frenzy about Facebook. The bubble giveth, and the bubble taketh away . What brought Facebook's prospects down – at least, on its first day of trading – was the simple fact that the relationship between a company's stock price and its true value has always been an uneasy one. It is more so for this strange breed of social media leaders – Facebook, LinkedIn, Groupon, Zynga – which appear in front of millions of people but have relatively little in revenue to show for it. Facebook, as the leading social media company of our time, tested the limits of whether investors are willing to pay anything to participate in the popularity of social media – the way they filed like lemmings to invest in hapless dotcoms like Pets.com in the late 1990s. With Facebook as their avatar, other social media companies have sought high valuations: Instagram recently sold for $1bn, and the most recent estimate on the scrapbooking site Pinterest was $1.5bn. What happened was a decisive statement. Wall Street is trying to capitalize on the financial hype by sending out companies like Facebook, LinkedIn, Zynga and Groupon public before they are mature enough to sustain the pressure of being publicly-owned companies. But what Wall Street wants and what Wall Street gets, these days, are two very different things. Regular investors – just normal Americans – bought 20% of the Facebook IPO. They are usually known derisively as the "dumb money". They have wised up a bit, perhaps, in the decade since the dotcom bubble. Most of the hype, and the expectation of vast riches, came from Wall Street bankers and professional investors – another sign, perhaps, that the finance industry is trapped in its own bubble, out of touch with American sentiment. For Facebook, the first day of trading was mildly embarrassing – no big "pop". It closed on the day moving down: the stock closed at $38, the exact prior price set by the underwriters. As a metaphor, this was irresistible: after all the excitement, talk, euphoria and disappointment, Facebook ended the day right where it started. Facebook IPOs US economy Media business Social media Technology sector United States Mark Zuckerberg Banking Heidi Moore guardian.co.uk © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds (2 h ago)

• The G8 and the euro: make this one count The G8 and the euro: make this one count
05/18/2012
Europe needs to go in for a proper restructuring of its banking sector along the lines of that executed by Gordon Brown and Alistair Darling in 2008-09 History suggests that the last place one would look for the resolution of a crisis is a summit of world leaders. Yet every so often summits can pave the way to a sea change in policy. The G20 meeting in London presided over by Gordon Brown in the spring of 2009 agreed an impressive-sounding trillion dollar boost to the world economy, but more importantly sealed a deal between the leading powers that they would each spend more until the spectre of recession was warded off. Similarly, the first G20 summit that David Cameron attended as prime minister in 2010 marked the point at which Europe and America parted ways on economic policy. Two summits, two opposing results, yet each hugely significant. Let us hope that the G8 meeting kicking into gear in Washington this weekend is of a similar rank of importance. Certainly, the situation Mr Obama and his colleagues confront is potentially even more grave than the one they faced in those early months after Lehman Brothers collapsed. However amazing it is to imagine, it is not hyperbolic to say that the euro stands on the verge of a death spiral – and that there are precious few opportunities left to pull it back from the brink. It is not simply the very real prospect of Greece leaving the single currency; it is also the palpably distressed condition of Spanish banks (as suggested by this week's credit-rating downgrade for 16 of them, and the collapses in their share prices), and of so many others across Europe; plus the long-standing issue that Spain and Italy and a number of other countries are now finding it increasingly difficult to get the loans they need from financial markets. On its own, the ejection from the euro of a country worth only around 2% of the club's GDP would still be shocking and chaotic. But put it together with the fragility of confidence – financial, business, political and public – across the continent and you have a recipe for chaos on a scale that would make the 2008 bonfire of the banks look like a relatively pleasant memory. Against this backdrop, the tasks that face the G8 are large, but they can be broken down into three: financial, economic and political. Each can be easily clarified, but they will require huge expense of capital, both financial and political, to carry out. The financial part of resolving the euro crisis has to begin by acknowledging that the continent's crisis revolves around its banks. Spain went into the financial crisis with very modest public debt, which increased sharply as the government had to deal with a housing and banking bust. Even now, a large part of the reason why Madrid remains a candidate for a financial rescue line from the rest of Europe is because if its banking sector suffered a big collapse, the government would have to step in. In other words, the banking sector debt is de facto a contingent debt on the government's balance sheet. This is madness, but it is also highly dangerous. To sort this out, Europe needs to go in for a proper restructuring of its banking sector along the lines of that executed by Gordon Brown and Alistair Darling in 2008-09. Since crisis-stricken southern Europe does not have the resources to do this, it will have to be done on an international basis with funds contributed by other countries. The economic part of rescuing the euro begins by halting the counter-productive austerity programmes, and agreeing a collective fiscal-stimulus package to be led by Germany. Ms Merkel can borrow at record-low interest rates from the financial market: this is money that should be used to revive the euro area. Finally, Europe's political classes need to realise that a continent that now revolves around a failing euro project, and one that demands its member nations engage in destructive austerity, is doomed to political as well as economic failure. The euro project needs to be reimagined as something altogether more positive. G8 Financial crisis Economics Eurozone crisis European Union European monetary union Euro Greece guardian.co.uk © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds (3 h ago)

• Facebook IPO: social network makes stock... Facebook IPO: social network makes stock market debut – Friday 18 May
05/18/2012
• Facebook breaks even in first day of trading • IPO smashes record for trading volume with 565m shares • Underwriters step in to shore up $38 offer price • Launch delayed amid confusion at Nasdaq • Follow our Facebook shareholder wealth tracker here 8.30am ET/1.30pm BST: Mark Zuckerberg will ring the bell for the opening of the Nasdaq stock market at 9.30am as he kicks off a share sale that will value the company at $104bn. We'll be live blogging the day's events here in New York, and you can see how the fortunes of Zuckerberg and the social network crew rise (or fall). Not since Google's initial public offering (IPO) has a share sale been as closely watched. It's Super Bowl for social media: every commentator in the land has an opinion on whether the firm is really worth that sort of cash, and is lining up to share it. At $104bn, Facebook is being valued at more than the combined value of Nike and Goldman Sachs. Last year Facebook had revenues of $3.7bn. Goldman's were 10 times that. But this is a company with massive potential. Facebook will have more than a billion people logging in to its service this year – that's more than three times the populations of the US – and it hasn't got started in China. Nearly 400 million people log on six days a week. In the first three months of this year those people "liked" or commented on Facebook items 3.2bn times a day. Google added a verb to the lexicon; Facebook redefined "friend" and "like". Now Zuckerberg has to find a way to make his social network live up to its massive promise. 8.30am ET/1.30pm BST: Mark Zuckerberg will ring the bell for the opening of the Nasdaq stock market at 9.30am as he kicks off a share sale that will value the company at $104bn. We'll be live blogging the day's events here in New York, and you can see how the fortunes of Zuckerberg and the social network crew rise (or fall). Not since Google's initial public offering (IPO) has a share sale been as closely watched. It's Super Bowl for social media: every commentator in the land has an opinion on whether the firm is really worth that sort of cash, and is lining up to share it. At $104bn, Facebook is being valued at more than the combined value of Nike and Goldman Sachs. Last year Facebook had revenues of $3.7bn. Goldman's were 10 times that. But this is a company with massive potential. Facebook will have more than a billion people logging in to its service this year – that's more than three times the populations of the US – and it hasn't got started in China. Nearly 400 million people log on six days a week. In the first three months of this year those people "liked" or commented on Facebook items 3.2bn times a day. Google added a verb to the lexicon; Facebook redefined "friend" and "like". Now Zuckerberg has to find a way to make his social network live up to its massive promise. 8.52am ET/1.52pm BST: Trading action on Facebook shares is not likely to commence until 10:30am ET at the earliest, as bankers work through the mechanics of the offer, market sources said. 9.13am ET/2.13pm BST: The delayed debut of Facebook stock this morning affords us time for a walk down memory lane... back to 2004, when FB chief Mark Zuckerberg was still just a cocky college student bragging about his hacking exploits in instant messages to friends. Those messages are now a matter of public record. The Guardian's Josh Halliday writes: Zuckerberg appears to confirm in one message that he secretly hacked into the website of the Harvard University newspaper, the Crimson, by guessing the emails and passwords of two people in the college database. "So I want to read what they said about me before the article came out and after I complained," he told a friend. "So I'm just like trying the email/passwords of everyone who put that they're in the Crimson. I wonder if the school tracks stuff like that." In another message, Zuckerberg boasts about deactivating college students' accounts on the internal Harvard social network, ConnectU. "I got bored so I started deactivating accounts on ConnectU haha," the future cyber-grandee writes. 9.23am ET/2.23pm BST: CNBC, which is tracking the Facebook IPO, is reporting on the overnight "hackathon" at the company's Menlo Park, California, campus. In the run-up to today's big splash, employees spent the night at their place of work writing computer code, over-caffeinating and giving their eyes a little extra practice staring at computer screens. The event reflects the company's youthful, creative, spontaneous, creative culture. Employees ordered Chinese food and there was talk of them making a run to In-n-Out Burger, CNBC reports. How does the news change your bet on what Facebook stock will do today? Let us know in the comments. 9.28am ET/2.28pm BST: Hackathon Update. It turns out there was one Facebook face who declined to participate in last night's ritual of camamaderie and computer fun. Zuckerberg apparently called it a night early in the evening, Josh Halliday reports. He went home to his girlfriend Cilla and their Hungarian sheepdog, Beast. When you're the boss you get to do that. 9.30am ET/2.30pm BST: Mark Zuckerberg has just rung the bell opening the Nasdaq market. He did so from a stage at the company's Menlo Park HQ. Then he hugged COO Sheryl Sandberg. The stage is full of other FB execs, with a sea of employees all around. A boom camera is capturing the action in the cheering, waving crowd. Looks like Bonnaroo. "A Woodstock event," someone on CNBC just called it. 9.39am: The scene at Facebook HQ in Menlo Park in the run-up to the IPO. The company is valued at $104 billion as shares go on sale to the public. 9.36am ET/2.36pm BST: The Guardian's Dominic Rushe has been talking to David Kirkpatrick , author of The Facebook Effect – the only book written so far with Facebook's cooperation – and a man who has spent many many hours with Mark Zuckerberg. "His impact on the world will be as least as big as Bill Gates and probably already has been," Kirkpatrick tells Rushe. "Like Gates I'm positive he is going to end up being one of the world's great philanthropists. I believe he has a very strong social conscience." He says this will be a big day for Zuckerberg but that while the Facebook boss may party later, he'll try to keep things as normal as possible once he has rung the bell. Then the real work begins... "I spoke to Peter Thiel [Silicon Valley investment legend and one of Facebook's early backers] and he said Facebook had this peculiar quality, it will either completely dominate or it will completely go away. I don't think it's going away anytime soon though." Fitzpatrick predicts that Zuckerberg could soon be the world's richest man. 9.40am: One take on the big offering. Wocka! Wocka! twitter.com/dmataconis/sta… — Doug Mataconis (@dmataconis) May 18, 2012 10.10am ET/3.10pm BST: Facebook is summoning great spectacle in its rollout this morning – but will the stock price hold up? When the excitement dies, will the company warrant its $104 billion valuation, and the $38 share price? One main place investors locate value in Facebook is its potential power as an advertiser. With 900 million users and counting – and a potentially vast market in China still waiting to be tapped – Facebook has an unparalleled capacity to put ads in front of eyes. But earlier this week, US auto manufacturer GM decided that those ads weren't worth it, ending its Facebook campaign. The company had been spending $10 million a year to advertise on the site, but none of the reports measuring those ads' profitability came back positive. The Economist spoke with Chris Perry , marketing chief for GM's brand Chevrolet, who confirmed that "a routine marketing review concluded that the site delivered 'insufficient' results. Companies still believe that Facebook is an indispensable tool for spreading buzz about new products, however: That viewpoint was echoed by the senior media buyer at a major Detroit ad agency, who asked not to be identified by name because he is not authorised to discuss strategy with the press. Based on clicks-throughs alone, he says, Facebook "doesn't pay off." His agency's approach is to use the service as part of broader social media campaigns. 10.21am ET/3.21pm BST: Facebook co-founder Eduardo Saverin came in for a drubbing last week when it was revealed that he had disclaimed US citizenship in favor of residence in Singapore, which does not have a capital gains tax. Saverin responded to the criticism by saying that his move was not a tax dodge; he simply prefers Singapore. Last night Saverin set the controversy aside to offer his former colleagues a hearty congratulations on his personal Facebook page . He misspelled his co-founder's name – but it's the thought that counts? On the eve of the Facebook public float, 8-plus years in the making, I as co-founder wanted to look back and cherish Facebook's early beginning. Congrats to everyone involved in the project from day one till today, and I especially wanted to congratulate Mark Zukerberg [sic] on keeping tremendous stead-fast focus, however hard that was, on making the world a more open and connected place. 10.37am ET/3.37pm BST: A major status update for the Facebook cofounder: as Mark Zuckerberg rang the bell to open the Nasdaq exchange, his account automatically spread the news. Zuckerberg tagged fellow executives Chris Cox, vice president of product; the chief finance officer David Ebersman; the vice president of finance Cipora Herman; and his trusted No 2, Sheryl Sandberg. 10.46am ET/3.46pm BST: Facebook as a growing concern. Whatever happens with the stock price today, the immense market draw of the company is plain to see in a chart tracking users, from about 300 million in March 2009 to 900 million today (blue is all Internet users worldwide; brown/gray is FB users): 10.42am ET/ 3.42pm BST: T-minus three minutes and counting: Nasdaq has just announced that trading in Facebook shares will begin at 10.45am ET. 11.02am ET/4.02pm BST: Reuters is reporting that the opening of trading has been pushed back a bit: RT @ ProducerMatthew : Reuters: Facebook IPO extended by additional 5 minutes, to trade at 11:05 AM ET - NASDAQ — Anthony De Rosa (@AntDeRosa) May 18, 2012 11.23am ET/4.23pm BST: Nasdaq has announced that there has been a delay in the start of Facebook trading . We're reaching out to sources at Nasdaq to find out more about the holdup. The latest delay is the third or fourth of the morning. Nasdaq itself puts out time call information. Meaning the market itself is failing to predict when the market will go to work. The Wall Street Journal is now reporting that traders are having problems changing or canceling their orders ahead of the Facebook IPO. Will Zuckerberg have to change his status again? 11.27am ET/4.27pm BST: IPO delayed indefinitely by glitch in market: This isn't the headline Facebook was looking for this morning. Wow, Nasdaq found the only way possible to upstage the Facebook IPO. — Heidi N. Moore (@moorehn) May 18, 2012 11.30am ET/4.30 pm BST: Mark Zuckerberg and colleagues ringing the opening bell for Nasdaq at 9.30am ET. Looks anticlimactic now. 11.30am ET/4.30pm BST: And they're off. Facebook is now on sale – and the first shares cross at $42.05, a good deal higher than the $38/share rollout price. For the time being, at least, the company has 100 billion reasons to cheer. 11.34am ET/4.34pm BST: How big is trader interest in Facebook ? 82 million shares were traded in the first 30 seconds, according to Nasdaq. The stock price is bumping along at the $40-$41 level. You can follow the stock price here. 11.36am ET/4.36pm BST: How will Facebook shares perform in the first day of trading? Tell us what you think. For extra credit, let us know in the comments what you think the high price and the low price of the day will be. 11.50am ET/4.50pm BST: As the Facebook share price settles back to $38 , The Guardian's Nils Pratley contributes his analysis of the pricing dynamics . If the stock goes too high, insiders who sold in advance of the IPO may resent the investment bank. A share price of around $41 would satisfy most everyone, Pratley writes: A 10% pop should satisfy the IPO advisers. When you start getting to 20%-plus, the insiders who are selling feel short-changed and accuse the investment bank advisers of misjudging demand. 10% is ok - it meets the "leave something on the table for the next person" rule. 11.56am ET/4.56pm BST: A look back at the hot tech IPO of 20 years ago: Celebrating Facebook IPO today while reflecting on AOL IPO 20 years ago. Valuation was $70 million. Most thought Internet was a fad. #wrong — Steve Case (@SteveCase) May 18, 2012 12.03pm ET/5.03pm BST: One stock that really doesn't like what it's seeing in the Facebook IPO: Zynga, the Internet gaming company. Zynga, which depends on Facebook for a platform for its games, had an underwhelming IPO of its own in December, when it fell 5 percent in its first day of trading. So far today Zynga is down 13 percent. UPDATE 12.07pm ET: Trading in Zynga shares has now been halted. 12.18pm ET/5.18pm BST: Facebook stock has been out of the gate for 50 minutes. After opening at just above $42 the stock dropped to the break-even level of $38. But instead of continuing to fall, the stock staged a resolute recovery: So what happened? Here's Dominic Rushe: Facebook's shares came dangerously close to falling below $38, the offer price, and have now rallied. This chart shows what happened. The speculation is that the underwriters have piled in and supported the price that we are chasing now. If it's true, they can't support the price forever and you can expect FB's shares to fall next week. But – and it's a big but – there have clearly been problems with the IPO at Nasdaq, orders for shares were backed up and may have caused these weird price movements. There are however signs that investors are underwhelmed. Zynga shares were suspended after they crashed this morning – not a good sign as the game firm is largely dependent on Facebook for its business. 12.34pm ET/5.34pm BST: Have underwriters stepped in to hold Facebook shares above $38? Business Insider gets a look at the order book, sent in by Twitter user @Bourbon_Meyer . "It strongly appears that there's a huge perma-bid at $38 on Facebook," Joe Weisenthal writes . "Check out the big mass of yellow on the left column... all those bids at $38." 12.39pm ET/5.39pm BST: If you don't own Facebook shares yet, are you currently missing an historic opportunity to get in on the ground level of a company that's about to break all previous records for stock growth? Warren Buffett apparently doesn't think so. Here's what the Oracle of Omaha has to say about IPOs in general: It's almost a mathematical impossibility to imagine that, out of the thousands of things for sale on a given day, the most attractively priced is the one being sold by a knowledgeable seller (company insiders) to a less-knowledgeable buyer (investors). 12.55pm ET/5.55pm BST: Facebook staffers have flocked to the social network to bask in the post-IPO glow, the Guardian's Josh Halliday reports. Lindsey Cochran, who works in marketing at Facebook, writes: "I vividly remember signing up for facebook in the upstairs quad of 508 Thurston ... in April of 2004. I can't believe I am now going to be a part of such a historic moment. Feeling incredibly lucky!" Gabe Hernandez, another staffer, says: "While I won't be in any of the Facebook offices to celebrate today, I am wearing my hoodie in solidarity. Thanks everyone for making my job far from the last place I ever want to be. Now stay focused and keep hacking!" Meanwhile, Zuck has returned to his Facebook to note: "This is a pretty awesome hack." 1.09pm ET/6.09pm BST: Till death do us part – or your company doth go public. Will the Facebook IPO cause a spike in shareholder divorces as new millionaires are created and relationships become more liquid, as it were? The Financial Times has a morbidly droll (and paywall-protected) report: "When Google went public, there was a wave of divorces. When Cisco went public there was a wave of divorces," says Steve Cone, a divorce attorney based in Palo Alto, near the social network's Menlo Park headquarters. "I expect a similar wave shortly after Facebook goes public." 1.16pm ET/6.16pm BST: Dominic Rushe checks in on the Internet gaming company Zynga , and what the poor performance of its stock today could mean for Facebook: Facebook's shares have recovered after dropping worryingly close to their $38 offer price. But over at Zynga there are still problems. As we mentioned earlier, it looks likely that Facebook's battalion of bankers moved to make sure FB didn't drop below $38. Zynga had no such luck and was down more than 13% at one point. It's now down nearly 6%. Zynga is basically a way to trade Facebook, since nearly all of its business comes from the social network. So is this what FB's share fall would look like if the bankers hadn't piled in? Just sayin'. 1.22pm ET/6.22pm BST: Guardian tech editor Charles Arthur looks at what's next for Facebook : What to expect now? Don't be surprised if the next big thing is a Facebook phone – running its own software and developed from top to bottom to involve you in the site all the time. Zuckerberg's team has been advised to do this directly, because it needs to reach the "next billion" internet users, and they are mainly going to be using mobile phones, not desktop or laptop computers. Selling its own phone would mean it could make itself the background hum of many peoples' lives everywhere – and show adverts and collect data on its own terms. Read Charles' full analysis here . 1.55pm ET/6.55pm BST: Bloomberg reports that Facebook underwriters did in fact start buying shares at $38 to keep the stock from falling below its offer price: Facebook Inc. (FB) underwriters purchased the company's stock to keep it from falling below $38 a share after debuting on the Nasdaq Stock Market, people with knowledge of the matter said. The bankers supported the stock after Nasdaq OMX Group Inc. (NDAQ) faced difficulties delivering trade execution messages after the initial public offering, said one of the people, who asked not to be identified because the transactions are private. 1.42pm ET/6.42pm BST: If you haven't checked out our live tracker of top Facebook shareholders' wealth based on today's fluctuations in the FB share price, you can have a look here . For the record, Mark Zuckerberg is currently "worth" more than $20 billio 2.59pm ET/7.59pm BST: One person we haven't heard a lot from today is Sheryl Sandberg – but expect that to change. Here's Dominic Rushe: Sandberg is one of the most impressive execs in the US with a resume that includes the US Treasury, Google and McKinsey. You can read my profile of her here . Sandberg was late to the Facebook party; she joined in 2007 when Zuckerberg poached her from Google. Back then Facebook had 70m users and no profits. How things change. She holds 1.9m shares and has made a small fortune today. Sandberg stands to make a far larger fortune in the near future. She has 39m restricted stock units, most of which are tied to performance targets. If she hits them – and history suggests she will – Sandberg will become a billionaire, which is a rarity for employees. That kind of reward usually goes to the founders, not the help. 2.52pm ET/7.52pm BST: Dominic Rushe places the Facebook stock performance in the context of the lackluster Nasdaq showing this week: "OK I admit it. I've had a bit of a downer on Facebook at $100bn plus. It's an amazing company but I just don't think it's proven worthy of that kind of valuation yet. And maybe bankers are propping the share price up. "Even so, today's performance needs to be set against what has been happening to the rest of the Nasdaq companies this week. One look at this graph of the Nasdaq over the last five days shows, this wasn't an easy week to launch." 3.02pm ET/8.02pm BST: With an hour to go until the Nasdaq close, Facebook's shares are at $39 a share and Mark Zuckerberg has outpaced several of the world's richest men. With wealth of over $21bn, Zuckerberg is now worth more than Jeff Bezos at Amazon or either of the Google founders, according to the Forbes list of billionaires. He was briefly richer than New York mayor Mike Bloomberg, but has now just slipped behind B's $22bn pile. Poor thing. 3.20pm ET/8.20pm BST: Has the Facebook IPO been a success? With 45 minutes to go until the closing bell, the stock is slowly sinking from around the $40/share range back to its opening price of $38. In the New Yorker, John Cassidy sees a party that fizzled: At 11:30, the stock opened at $42, jumped up to $43, fell back $42—and kept falling, back to $40. "For market sentiment, this is not going to be positive," said Simon Hobbs, the network's resident Brit. Melissa Lee was equally crestfallen: "Forty minutes ago, I don't think anybody thought $40," she said. David Faber had been working the phones, and he reported that his sources had told him the stock might well fall below the issue price of $38, which would be a big embarrassment to the banks underwriting the deal, led by Morgan Stanley. "The big story is that Facebook, the social network, is now a public company," he said. "The smaller story is that after five minutes, it's only up six per cent." Henry Blodget, in contrast, congratulates the investment banks for rolling out a stock that was "perfectly priced" : This price level was ideal for almost everyone involved--with the exception of short-term traders who bought the stock only to instantly flip it. (And no one should cry for them). With such a modest pop, Facebook and its selling shareholders did not leave tens or hundreds of millions (or even billions) of dollars on the table--an expensive mistake that most companies make. When LinkedIn went public, for example, the bankers underpriced the deal, and the company needlessly handed $100+ million to institutional investors. Heidi N. Moore has been arguing that the failure of the stock to lift and hold above its initial offer price of $38 is making for a "rocky" debut . What you're not seeing right now is 33 banks all seeking to blame each other for why this stock is barely clinging to a decent open. $$ FB — Heidi N. Moore (@moorehn) May 18, 2012 3.26pm ET/8.26pm BST: Here's a eye-catching list from Heidi N. Moore , comparing Facebook to other big companies in terms of market value and revenue. She calls the list "One of These Things Is Not Like the Others: Facebook Edition." At $40/share, Facebook ranks 6 out of 10 in terms of market value ($112bn). Guess where Facebook ranks in terms of revenue? Google: Market value $200 billion; 2011 revenue $37.9 billion JP Morgan Chase: Market value $127 billion; 2011 revenue $99.8 billion Verizon: Market value $117 billion; 2011 revenue $110.9 billion Merck: Market value $115 billion; 2011 sales $48 billion GlaxoSmithKline: $112 billion; 2011 sales $44 billion Facebook: Market value $112 billion; 2011 revenue $3.7 billion Anheuser-Busch: Market value $111 billion; 2011 revenue $39 billion PepsiCo: Market value $109 billion; 2011 revenue $66.5 billion McDonald's: Market value $91 billion; 2011 revenue $27 billion Cisco Systems: Market value $89 billion; 2011 sales $10.4 billion 3.41pm ET/8.41pm BST: Facebook stock on the day of its IPO after four hours of trading: $38. 3.50pm ET/8.50pm BST: Facebook shares seem to be trying their hardest to sink below the $38 offer price. The underwriting banks are in the market to shore up that price. And they're dealing with a lot of volume: record volume, in fact. The previous record for most shares traded on the day of an IPO was set by General Motors Co. (GM), at 458 million. With 10 minutes to go in the trading day, Facebook has already smashed the record with 532 million . 3.54pm ET/8.54pm BST: And this, folks, is as good as financial TV gets . EPIC: FACEBOOK UNDERWRITERS WAGING HUGE BATTLE HAPPENING RIGHT NOW TO HOLD THE $38 LEVEL read.bi/M24r5A — Joseph Weisenthal (@TheStalwart) May 18, 2012 4.00pm ET/9pm BST: And the close: Facebook shares end their first day of trading at $38.23 – up 23 cents a share on record volume. 4.06pm ET/9.06pm BST: Here's what the last hour of trading looked like for Facebook. Down to $38 and then flat, flat, flat. It's almost as if there was an artificial floor holding it there. 4.10pm ET/9.10pm BST: It's hard to see how the headlines now aren't hard on Facebook . The market didn't want the stock at that price. Some schadenfreude on Twitter: Currently lol'ing at the people who thought $FB would close at > $60 today. — Ethan Klapper (@ethanklapper) May 18, 2012 After final trading volume of 565 million shares, an IPO record, the price didn't move. Hey, keep it on the down low, but I hear there is still a chance to get in on the Facebook IPO at the offering price! — James Sununu (@jsununu) May 18, 2012 4.47pm ET/9.47pm BST: Heh. My two cents: Whole lot of frantic for 38 penny advance in share price. — david carr (@carr2n) May 18, 2012 4.50pm ET/9.50pm BST: The Securities and Exchange Commission announces that it will investigate what caused the delay this morning in the Facebook rollout, CNBC is reporting . The regulator will look into why it apparently was that not all traders had the same information at the expected time. 4.55pm ET/9.55pm BST: We're going to wrap up our live blog coverage of the Facebook IPO. It wasn't the fireworks display some investors expected to see. This morning market watchers were discussing whether Facebook would post double-digit gains in its first day. Precedents such as LinkedIn, which jumped 107 percent in its May 2011 IPO, made it seem possible that Facebook could hit $50 or higher. It has been a tough week for the markets in general – the worst week for stocks in all of 2012 so far, in fact. The Dow dropped 450 points this week, or 3.5 percent. The Nasdaq and S&P 500 were both down. But the spectacle of the underwriting banks that set Facebook's offer price of $38 having to buy shares for the final hour of trading to shore up that price made the offering feel flat. Here's a summary of what happened: • Facebook ended the day virtually even. The stock opened at $38. The stock closed at $38.23 (up .61 percent). • The company shattered the record for IPO volume, with 565 million shares changing hands. GM held the previous IPO volume record with 458 million shares. • Because of a Nasdaq glitch, in which traders were unable to get confirmation of their trades early in the day, the IPO was rolled out about a half-hour later than expected. The first Facebook shares traded at 11.30am ET. The SEC has announced it is investigating. • At today's valuation, Mark Zuckerberg's Facebook fortune tops $20 bn. Facebook IPOs Mark Zuckerberg Stock markets United States Internet Social networking Tom McCarthy Dominic Rushe guardian.co.uk © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds (3 h ago)

• Eurozone crisis live: Row after Angela M... Eurozone crisis live: Row after Angela Merkel 'suggests Greece holds euro referendum'
05/18/2012
• German chancellor 'proposes euro referendum' • Greek politicians furious ... Berlin denies it • Almost £80bn wiped off FTSE 100 this week • EC: We want to keep Greece in eurozone, not out • Trade commissioner: contingency plans are in place 9.45pm: And with that, we're done for the day, What a dramatic week, in which the prospect of Greece leaving the eurozone grew, and stock markets fell steadily in the face of a flood of bad news. Thanks, as ever, for reading and commenting. Have a great weekend. 9.38pm: Greek leftist leader Alexis Tsipras has given an interview to the Guardian in which he describes the election campaign as "a war between people and capitalism". It begins: "I don't believe in heroes or saviours," says Alexis Tsipras, "but I do believe in fighting for rights … no one has the right to reduce a proud people to such a state of wretchedness and indignity." The man who holds the fate of the euro in his hands – as the leader of the Greek party willing to tear up the country's €130bn (£100bn) bailout agreement – says Greece is on the front line of a war that is engulfing Europe. The whole piece, by Helena, is here . 9.16pm: Helena Smith, our Athens correspondent, had the pleasure of meeting London Mayor Boris Johnson yesterday (he was in Athens to play his part in the Olympic Torch exchange). Helena reports that while Boris comes from the opposite end of the political spectrum, he seems to agree with Greek far left leader Alexis Tsipras that Greece is in a much stronger position than might at first seem. She writes: "I don't think for a moment Greece is going to be thrown out of the EU," Boris told me. "To do so would be to throw out the baby with the water ... and I don't think for a moment Tsipras will do anything that would lead the country [to exiting the euro zone]," said the former journalist, who it would seem is a keen follower of Greek affairs. The prospect of Greece returning to the drachma was, Johnson agreed, as remote as the UK joining EMU. But for safety's sake he had some of the old currency in his pocket - and what would have been back in 2001, when Athens signed up to the euro, a reasonable amount. "I was told to come back in a month," he joked, after trying to pay his dinner bill with it. Only Boris.... 9.09pm: World leaders have been discussing the Greek crisis in America, where they are gathering for the G8 summit. François Hollande , the new French president, said it was essential that Greece remains in the eurozone, adding that he had told Barack Obama that economic growth must be a priority for Europe. David Cameron has also been speaking, and repeating his line that the eurozone must take "decisive action" on Greece, and that Greeks must "make their minds up" about the country's future plan (as, indeed, they should do on June 17). 9.07pm: On Wall Street, the ongoing eurozone crisis helped to send shares lower again, with the Dow Jones index finishing 73 points lower at 12369, a fall of 0.6%. That means the Dow has fallen 3.5% in the last week, and has fallen in 12 days of the last 13. Facebook's less than stellar IPO didn't help. 8.40pm: Our Greece correspondent Helena Smith has just worked the phones and says there is a view in Athens that Angela Merkel's suggestion may have been "lost in translation." A high-level source told Helena : My explanation after calling the prime minister's office is that Mrs Merkel may have said the election was like a referendum and the president may have misunderstood. Because the details of the conversation were released by the president's office it is very difficult to verify but there is a feeling it was lost in translation. So maybe it's not a farce, maybe it's a romcom . From Greece, Theodora Oikonomides kindly reminds me that President Karolos Papoulias is a fluent German speaker. Update: However, Helena's been told that the conversation was conducted in Greek. It seems that the full picture will only become clear if/when the transcript of the call is released... 8.19pm: Whatever the truth of the situation, Germany and Greece risk an embarrassing diplomatic spat over the claim that Angela Merkel proposed a euro membership referendum. Many Greek citizens are already weary of the meddling in their elections from outside, so Merkel's apparent interjection is not going to help. For the rest of us, it reinforces the feeling that Europe still hasn't got a grip on the crisis. So, Greece is denying a denial by Merkel that she suggested Greece hold a referendum, which it is doing anyway — Chris Adams (@ChrisAdamsMKTS) May 18, 2012 Our European editor, Ian Traynor , also dispairs: #euro greece and germany #headlesschickens — Ian Traynor (@traynorbrussels) May 18, 2012 One can only imagine what Barack Obama will make of it at the G8 summit. Makes Washington look like a model of democratic efficiency (until the debt ceiling talks come round again, anyway). 7.58pm: This is turning into something of a farce. According to reports from Athens, the Greek government is now rejecting Berlin's denial, insisting that Merkel did suggest running a referendum alongside the June 17 vote..... 7.21pm BST: The German government has now denied that Angela Merkel suggested that Greece should hold a referendum. Reuters is quoting a German government spokesman that: This is false and we completely dismiss this. But as reported at 6.26pm, the statement from the Greek prime minister is pretty clear. It says that: "She [Merkel] also conveyed to the President of the Republic thoughts about the holding of a referendum parallel to the elections on the question of whether the Greek citizens wish to remain in the eurozone." So what exactly were Merkel's thoughts on the idea of a euro referendum, which wasn't being discussed until this evening.... 7.10pm BST: There's been a rapid backlash in Greece to the news that Angela Merkel had proposed that Greece should hold a referendum on its euro membership. Alexis Tsipras, head of the Syriza coalition, reacted quickly, saying Merkel had grown used to treating Greece "like a protectorate". He blamed the leaders of the mainstream political parties for encouraging this attiture. Tsipras (rising a wave of popularity by arguing that Greece's austerity package must stop), added that the June 17 elections will allow the Greek people to end their "austerity, subordination and indignity" in favour of "progressive developments across Europe". You can see Tsipras's full statement here, on RadioBubble . Antonis Samaras , the head of the conservative New Democracy party, also rejected the suggestion of a referendum, but for different reasons. Samaras said: The Greek people don't need a referendum to prove they're pro-euro. And Pasok MP Eva Kaili has also rejected Merkel's suggestion, telling Business Insider that the referendum: won't and can't happen. It is ironic and it is blackmail. Efthimia Efthimiou , financial journalist at Capital.gr , suggests that Merkel would have been aware that Greece's current coalition government lacked the authority to call a referendum, but wanted to ensure that the June 17 election was seen as a vote on Greece's future in the eurozone. 6.45pm BST: Angela Merkel's jaw-dropping suggestion that Greece should hold a referendum on its membership of the eurozone (as the Athens government stated at 6.26pm ) comes exactly 190 days after former prime minister George Papandreou resigned , after enraging European leaders including the German chancellor by suggesting the Greek people should vote on the terms of their second bailout. 6.26pm BST: The Greek government has released a statement, confirming that Angela Merkel suggested to president Karolos Papoulias that Greece should hold a referendum on its membership of the eurozone. The idea was then rejected by interim prime minister Panagiotis Pikramenos, as his caretaker administration simply does not have the authority to call a referendum. It's here, in Greek. Here's a translation of the key section in English, via Diane Shugart , who does a brilliant job of reporting Greek events on Twitter. Mrs Merkel reiterated the EU's support for Greece's efforts to overcome the crisis. She also mentioned that the EU intended to examine bolstering of policies aimed at growth and combatting unemployment in the European area. The issue of growth is, in any case, the basic issue that will occupy the extraordinary EU summit on May 23 in Brussels. She also conveyed to the President of the Republic thoughts about the holding of a referendum parallel to the elections on the question of whether the Greek citizens wish to remain in the eurozone. It is evident nonetheless that the issue is beyond the scope of the caretaker government. 6.15pm BST: Some remarkable late breaking news in Greece – national TV are reporting that Angela Merkel , the German chancellor, told Greek president Karolos Papoulias today that Greece should hold a referendum on its membership of the eurozone, alongside the election of June 17. We knew that Merkel and Papoulias had spoken by phone earlier today ( see 10.55am ), but this is an unexpected development.... More to follow! 6.10pm BST: An update on the situation at Santander UK following the one-notch Moody's downgrade last night, from my colleague Jill Treanor : Steve Pateman, head of Santander UK's high street banking operations, says that today, since the blanket news coverage of its one-notch credit downgrade, there has been " a modest increase in outflows in our retail business of around £200m, but this is less than 0.2 % of our retail deposits, and is no cause for concern". He points out that the bank is getting in £500m weekly into its ISAs and has a £35bn liquidity buffer. He also points out: "We have no exposure to Greece. We are fundamentally a very simple bank that lends to UK businesses and households," said Pateman. "People have lost sight of the fact that this a one notch downgrade", he added, and keeps the bank in the same rating status as other UK banks. The UK money is ringfenced from the Spanish parent. One way for it to flow back is through a dividend is one way - the last one was paid in the first half of 2011 - and is only done so if the board of the UK business wants to pay a dividend and if the Financial Services Authority approves. 5.40pm BST: European Parliament president Martin Schulz has visited Greece today. In a speech given in Athens, the German social democrat spoke plainly about the pain suffered by ordinary Greeks, before insisting that austerity could not be avoided. Here's the details of Schulz's speech: I understand your despair. I understand your resignation .I understand your anger. European solidarity demands that we stand by each other. The citizens of Greece are not to blame for the current situation, and yet are having to bear the main burden of it..... but, the first hard truth is this: austerity measures and structural reforms can not be circumvented. No EU country will release the next instalment of the EUR €130bn rescue package unless the next Greek government adheres to the commitments that have already been made. If Greece wants the Troika to keep its promise to pay the next instalment, which Greece needs by the end of June at the latest, Greece must also keep its promises Trust is founded in the reliability of both partners. If the next Greek government does not keep the promises that have already been made and adhere to the agreements that have already been reached, many people in neighbouring countries will have the impression that Greece does not keep its word. If you give up now, the next instalment of the bailout will not be paid. What that means is that the Greek State will have no more money in future to pay salaries, to pay pensions, to pay unemployment benefit, to keep the schools and hospitals going. People who say that all you have to do is not pay anything back are failing to mention that Greece would then receive no more credit, either from banks or from countries. Those who say we don't accept the memorandum, but we will stay in the euro zone, nourish a fake hope. The people who say that Greece need not abide by the agreements are failing to say that that can lead to only one thing, Greece's departure from the eurozone. So, it's the same argument as European officials have been making for weeks, but with a more 'human' tone at the start to try and sweeten the austerity pill. And despite Brussels officials insisting that they remain impartial and will accept the result of June's election, Schulz's comments must be read as a call to back parties who accept the current financial programme deal, and not to vote for the Syriza coalition. Political impartiality is being stretched... And, as regular reader James Wilkins points out: If Martin Schulz manages to scare Greek voters into voting for New Democraty or Pasok so that they can form the next government I doubt it will last long because additional austerity measures are planned in addition to the ones already in place. I am fairly sure that NO government will be able to carry them out. Agreeing the details of those new cutbacks/tax rises will be an early challenge for the next government. 5.15pm BST: Fitch has just followed up on last night's Greek downgrade, by cutting its ratings on the country's banks to CCC as well. They, like Greece itself until yesterday, has been rated at B-. Inevitable, really, given last night's move (it's unusual for a bank to have a higher credit rating than its sovereign). Here's the rationale: In the event that the new general elections scheduled for 17 June fail to produce a government with a mandate to continue with the EU-IMF programme of fiscal austerity and structural reform, an exit of Greece from EMU would be probable and/or this could be followed by a withdrawal of international support to Greek banks. A Greek exit would likely result in widespread default on private sector as well as sovereign euro-denominated obligations. 4.43pm BST: European stock markets have closed, and it's another day of losses as the eurozone crisis rumbles on. In London, the FTSE 100 shed 70 points, led by the banks and the miners. The crisis has wiped £79.76bn off the blue-chip index in the last week. Somewhat ironically, the only one of the Big Five European indices to rise today was Spain, which shrugged off Moody's decision to downgrade its banks last night. Here's the closing scores in Europe: FTSE 100: down 70 points, or 1.33%, at 5267 German DAX: down 37 points, or 0.6%, at 6271 French CAC: down 3.99 points, or 0.13% at 3008. FTSE MIB: down 40 points, or 0.3%, at 13048 Spain's IBEX: up 28 points, or 0.4%, at 6566. In London, Chris Beauchamp of IG Index dragged his eyes away from the Facebook IPO to comment: Bulls will doubtless be glad to put this week behind them, having had to endure a wave of selling that has its origins in Europe. A modest attempt to recover during the afternoon was sparked by news that the Spanish government was hiring advisers to assist with bank rescue plans, and this helped Spanish and Italian markets to push into positive territory. However, the effect of this soon faded and the selling began anew as US markets opened. The story remains identical to that seen throughout the week, namely a Greek exit from the euro and the possible repercussions. 4.17pm BST: Britain would suffer a deep slump, perhaps as severe as the recession that began in 2008, if Greece left the euro - the chair of the Office for Budget Responsibility, Robert Chote, has said. In an interview with my colleague Andrew Sparrow , Chote was clear that a Grexit would be a severe blow to the UK economy, destroying economic activity that would be extremely hard to rebuild. Chote, who approves the forecasts on which Britain's budget's are based, said: The concern is that you end up with an outcome in the eurozone that creates the same sort of structural difficulties in the financial system and in the economy that we saw in the past recession, and that that has consquences both for hitting economic activity in the economy, but also its underlying potential. And it's the latter which has particular difficulties for the fiscal position, because it means not just that the economy weakens and then strengthens again – ie, it goes into a hole and comes out – but that you go down and you never quite get back up to where you started. Although Chote's speaking about the UK, the implications for other economies would also be severe. More here . 3.57pm BST: Interesting development at the Bank of England this afternoon – monetary policy committee member Adam Posen will not take a second term on the MPC, and is rejoining Washington's Peterson Institute as director. Posen has been the most ardent supporter of quantitative easing, until a month ago when he surprisingly stopped voting for more electronic money to be created. With Posen not taking a second term, this means a vacancy on the MPC -- and perhaps less chance of the Bank launching QE3.... 3.53pm BST: Stephen Harper , prime minister of Canada, is planning to use this weekend's G8 summit to bang some European heads together. Having watched the eurozone crisis rumble on for the past few years, Harper now appears determined to take a tough line during the talks in Maryland. Andrew MacDougall , Harper's director of communications, told reporters in Ottowa that: The prime minister is of the opinion that this (the eurozone financial crisis) is the problem that needs to be talked about now, and I think it's good timing that we have this opportunity with some of the principals around a table. It seems like we've been discussing this issue for many a summit.... Tough action needs to be taken...We need to get on top of this. In the 1990s Canada, of course, pulled off an 'expansionary fiscal contraction' that conservatives often point to today. It cut public spending sharply, and still saw decent economic growth. Critics, though, argue that it's wrong to expct Europe to manage the same trick - as the world economy is in much worse shape today, and there's less margin for any new monetary easing (as policy is so loose already)... 3.32pm BST: On Wall Street, the Dow Jones industrial average has failed to claw much of yesterday's losses, despite the excitement of the Facebook IPO. The Dow is up just 17 points at 12459, a gain of 0.13%. In London, the eurocrisis continues to weigh on shares with tthe FTSE 100 down 63 points at 5275. 2.58pm BST: Missed this yesterday. Boris Johnson, Mayor of London, has reportedly given his backing to Greece while visiting Athens for yesterday's Olympic flame ceremony, as only Boris can. Athens News reports that Johnson told them that Greece should take solace from the fact that there's no mechanism to eject a country from the eurozone, and that Germany must accept the price of saving the euro. Or, as he put it: If the Germans want to sell washing machines to Greece then they have to pay for the single currency. You could argue that the underlying trade imbalances in the eurozone would be eased if the Greeks sold washing machines to the Germans. But, I guess Boris is more of a classics man than an economist. please @ AthensNewsEU tell us that @ mayoroflondon Boris Johnson made the German washing machine quip... in fluent ancient Greek... — Faisal Islam (@faisalislam) May 18, 2012 2.32pm BST: Just spoke to José Manuel Barroso's spokesman, Simon O'Connor , who insists that Europe has not drawn up a emergency contingency plan for Greece today (despite various reports on this line today). The commission is not working on the basis of a Greek exit scenario. We are working to keep Greece in the euro. The commission doesn't want to be drawn officially on the comments made this morning by trade commissioner Karel De Gucht ( see 10.15am ), that the ECB and EC have 'contingency plans' to avoid a 'domino effect' from a Greek default. De Gucht's comments are getting plenty of attention today, though . It sounds as if Olli Rehn, the European Commission's top economics official, has given Channel 4 News a similar line, in an interview being broadcast tonight. Update: As I blogged earlier, we'd long assumed that Europe was making some contingency plans for a Grexit (Mervyn King, Bank of England governor, has been clear that the UK authorities have been planning for such scenarios for a while). So, while there may not a full-blown contingency plan signed off and in place in Brussels, it would be more worrying (deeply irresponsible, really) if Rehn, Barroso, et al hadn't put some work into the issue -- given the proximity of the June 17 election in Greece. 1.45pm BST: The Irish economy continues to take a hit from its own debt laden, crisis stricken banking sector. Bank of Ireland - one of the banks rescued in the international bail out - has announced today it is axing 1,000 jobs - 250 more posts than they had projected earlier this year. From Dublin, Henry McDonald reports: Chief executive Richie Boucher said that as the bank restructures "the overall number of people which we need to employ will regrettably reduce". However, the Irish Banking Officials Association - the trade union for bank workers in the Republic - welcomed the fact that all the job losses will voluntary redundancies. While jobs continue to be lost in the banking sector there have been further glimmers of hope in the export-drive hi-tech sector in Ireland, with computer giant IBM revealed today that it hopes to create up to 300 new jobs at its Irish headquarters in west Dublin. Speaking of Ireland, Henry flags up latest polling shows that the Labour party, the junior coalition partner, has fallen behind Sinn Fein in the latest opinion poll on the state of Ireland's parties in today's Irish Independent. Sinn Fein has 17 per cent support while Irish Labour are down to 15 per cent. The poll comes 24 hours after an opinion survey on Irish attitudes towards the EU fiscal treaty. Significantly up to 35% of the Irish electorate remains undecided on how to vote at the end of this month. The results of the referendum will be known in a fortnight; a no vote could add to further de-stabilisation of the eurozone. 1.24pm BST: Anticapitalist campaigners have been demonstrating in Frankfurt today, as part of a protest called 'Blockupy'. According to local reports, police have begun removing people from outside a skyscraper that houses Goldman Sachs' German operation. Some roads have been closed, and Reuters says 40 people have been detained. The police presence appears quite high, given the small number of peaceful protesters, as these photos from The Wall Street Journal's Laura Stevens show (there are more pics on her Twitter feed .: #Blockupy #Frankfurt twitter.com/LauraStevensWS… — Laura Stevens (@LauraStevensWSJ) May 18, 2012 #Blockupy #Frankfurt twitter.com/LauraStevensWS… — Laura Stevens (@LauraStevensWSJ) May 18, 2012 Demonstrators have been protesting against Europe's austerity programmes , and against the way the financial system operates. German banks have said their operations have not been affected by Blockupy. 1.13pm BST: Here's some market commentary from David Jones of IG Index, confirming the grim mood in the City today: With around 250 points gone on the FTSE 100 since last week, the 2012 uptrend that held for so long finally appears to have broken. The ugly prospect of bank runs appears to be spreading over Europe, rumours having hit Spanish banks yesterday to complement those heard about Greece earlier in the week. As with so many things, it doesn't matter if it's actually true, since markets have worried about this for so long that the merest hint of capital flight raises investors' hackles. Bond yields are on the march, and shares in London are taking heavy losses once again. 12.47pm BST: Here's more details of the European Commission's official denial that it's working on contingency plans for a Greek exit (via Market News ) The European Commission is not working on any contingency plans should Greece leave the Eurozone, a spokesperson for the Commission said on Friday. "We completely deny that we are working on any such emergency plans" the spokesperson told MNI. "We are concentrating all our efforts on supporting Greece and keeping it in the Eurozone. That is the scenario we are working on," the spokesperson said. Have been trying to speak to the Commission on this myself.... As reported at 10.15am EU trade commissioner Karel De Gucht appeared to tell Belgian newspaper De Standaard that contingency plans were well underway. Unfortunately, the online version of this article only includes part of the interview , so it's tricky to know exactly what was said.... Open Europe, the think tank, says De Gucht has previous form on letting 'the cat out of the bag' on such issues.... 12.27pm BST: In a volatile session, European stock markets have clawed their way back, amid ongoing chatter in the markets that a short-selling ban might be reintroduced. The FTSE 100 is still in the red (down 30 points at 5309), but other markets are a little higher. Short-selling bans are usually brought in during times of crisis. They do tend to provide some short-term support for share prices, but don't fix underlying problems.... 12.04pm BST: The European Commission has now denied that is has been working on an exit plan for Greece, after trade commissioner Karel De Gucht told a Dutch newspaper that contingency plans had been drawn up (see 10.15am). European Commission spokesman Olivier Bailly has said that the EC "denies firmly" that any such exit scenario is being worked on, and that the Commission still wants Greece in the eurozone. There is no secret Grexit plan, Bailly insisted. #Barroso and #Rehn have been saying for 2 years that #EC wants #Greece to stay in #€. This remains TRUE! NO PLAN from #EC for #GREXIT . — olivier bailly (@ECspokesOlivier) May 18, 2012 11.07am BST: While European stock markets have suffered again, there has been another surge of money into AAA-rated government bonds. With investors desperate to find a safe home for their money, German bonds hit their highest levels ever. This pushed the yield (the measure of interest rate) on 10-year bunds down to a new alltime low of just 1.396% in early trading (Tradeweb date, via the Reuters terminal). UK 10-year gilts also strengthened, pushing down the yield to 1.81%. Such record low yields suggest both countries will be able to borrow at very low rates at the present time. Economists, though, see record low yields as a sign of stagnation. Dr Gerard Lyons of Standard Chartered pointed out that a similar pattern was seen in Japan during its financial crisis 20 years ago. During the lost decade in Japan a key sign of market throwing in the towel on the economy was when yields fell sharply - as now in Europe. — Gerard Lyons(@DrGerardLyons) May 18, 2012 Lyons was on sharp form on the BBC this morning too, describing the tension between Greece and the rest of Europe as a poker game, in which "instead of both sides playing Aces at the last minute they will produce Jokers". 10.55am: German chancellor Angela Merkel made a telephone call to the Greek president Karolos Papoulias this morning, to discuss the crisis. A German government spokesman has just confirmed the call, explaining that Merkel "expressed the German government's wish for a functioning government in Greece". According to Greek TV, Papoulias will now brief caretaker PM Pikramenos on the discussion, so more details might come out later... Seperately, a spokeswoman for the finance ministry has been quizzed about this morning's report ( see 10.15am ) that the ECB has been working on contingency plans in case Greece leaves the eurozone. No details emerged, but she did say that: Our citizens expect us to be prepared for every eventuality. 10.15am: EU trade commissioner Karel De Gucht has confirmed that the European Commission and the European Central Bank are working on an emergency scenario in case Greece should leave the euro zone. While we'd rather assumed that contingency work was underway, I'm not aware of an official stating it before (shout out if you know better). De Gucht made the comments in an interview with Belgian newspaper De Standaard , arguing that a 'domino effect' from a Greek exit could be contained: Both within the European Central Bank and the European Commission, services that are working on emergency scenarios in case Greece doesn't make it. De Gucht declined to give details, and added that he still expects Greece to remain in the euro ( quotes via Reuters' Brussels office ). 9.49am: In the financial markets, the FTSE 100 remains sharply lower, down 53 points at 5285, at its lowest point since 30 November. This moves the UK blue-chip index deeper into 'corrrection' territory, from its recent high of 5965 in mid-March. The German DAX and French CAC markets are also still in the red, both down around 0.6%. But surprisingly, the Spanish stock market is actually up. Led by Bankia , whose shares have surged by 28% this morning. Quite a turnaround, following yesterday's rumours of a bank run. Other financial stocks are also now up, despite Moody's volley of downgrades last night. That follows a report that Goldman Sachs has been hired to value Bankia – which could prelude a break-up. UPDATE: A couple of City types have also mentioned a rumour that Spain might impose a ban on short selling (selling stocks which you don't actually own). Nothing official though. 9.35am: The crisis in the Spanish banking sector comes nearly four years after Santander was playing a 'white knight' role during the UK's own banking crisis. Our banking expert Jill Treanor comments: Interesting times for Santander UK. This was the bank that the Labour government turned to during the 2008 crisis to take on Bradford & Bingley savers. It also bought Alliance and Leicester just before the crash. Now, unrelated to last nigh's downgrade, its attempts at a stock market flotation - earmarked for two years ago - are now pushed back until at least next year. Even so, it still has a strong rating and has not been downgraded as much as the overall group. 9.13am: The proportion of bad debts sitting on the books of Spanish banks has risen to its highest level since August 1994. Bank of Spain data showed that the bad loans rate across the Spanish banking sector rose to 8.37% in March. The number of loans falling into arrears increased by €1.6bn to €148bn. That underlines the thinking behind Moodys' downgrades last night – Spain's banking sector is stuffed full of loans that turned sour once the property market crashed. Those bad debts could grow significantly if the Spanish economy deteriorates, making it even harder for the Madrid government to recapitalise its banks and put them on a sound footing. As Nicholas Spiro of Spiro Sovereign Strategy points out: Spanish bank restructuring is a moving target: the deeper the downturn, the bigger the scope for a further deterioration in asset quality. 8.55am: France's new prime minister had stern words for European leaders this morning for their failure to help Greece through the financial crisis. Jean-Marc Ayrault, a former German teacher , added his voice to the chorus calling for a new growth agenda. Ayrault urged Brussels to put spare structural funds to work to help the Greek economy return to growth: We waited too long before helping Greece. This has been going on for two years now and only gets worse.... Tough talk, but not exactly unfair. 8.36am: German finance minister Wolfgang Schäuble said on Friday that the market turmoil surrounding the euro zone crisis could last another two years. Speaking on France's Europe 1 radio after Asian markets had tumbled , Schäuble said: Regarding the crisis of confidence in the euro ... in 12 to 24 months we will see a calming of the financial markets And that, it seems, is Schäuble being optimistic. He also appeared to warn Greek voters not to trust parties who promise to renegotiate Greece's financial progamme. It's up to Greek politicians to explain the reality to their people and not make false promises. We want Greece to stay in the euro but meet its commitments and that's a decision that's up to the Greeks. 8.27am: Santander UK , which was downgraded one notch by Moody's last, is stressing this morning that the downgrade won't affect its business. A spokesman said: The change to Moody's credit rating of Santander UK plc has no impact on our businesses in the UK or our plans for future growth. Santander UK plc is an autonomous subsidiary of the Santander Group, with more than 90% of its total assets held in the UK and a Eurozone sovereign exposure of less than 1% of assets. Santander UK is a key player in the British financial sector, having acquired Alliance & Leicester, Abbey National and Bradford and Bingley. It now has a higher credit rating than its parent company, following Banco Santander's three-notch drubbing. 8.10am: European stock markets have fallen at the start of trading, with Spain's IBEX showing the steepest losses. The IBEX shed 128 points, or 2%, at the start of trading, hitting a new nine-year low of 6409 points. That follows Moody's downgrading much of the Spanish banking sector last night ( see 7.49am ) In London, the FTSE 100 is down 50 points at 5289, a new low for the year. Just four shares have risen, while mining companies and banks are leading the fallers. Rio Tinto , Xstrata , Lloyds Banking Group and Barclays are all down at least 2.5%. It's a similar tale across Europe, with the Italian FTSE MIB down 1.5% and the French and German markets dropping around 1%. There's a really downbeat mood in the City this morning. As Clive Duckitt , director at Fyshe Horton Finney, commented: There seems little respite from the gloomy news that has engulfed equity markets in recent weeks. 7.56am: Risk aversion has driven the US dollar up this morning, as traders look to put their money somewhere safe. This has pushed the euro down to a new four-month low of $1.2649 against the US dollar. It has also pushed the oil price to its lowest level of the year, with a barrel of Brent crude dropping $1 to $106.40. That might actually bring some relief to the global economy, as high fuel and energy prices have been blamed for pushing up inflation. 7.49am: Moody's decision to downgrade much of Spain's banking sector last night has put country's financial problems under even more scrutiny. Some downgrades had been anticipated, but the scale of the move is still quite dramatic – with 16 banks downgraded in total and some, including the giant Santander, by three notches. Moody's blamed the weak Spanish economy (currently in recession), and the Madrid government's reduced ability to support troubled lenders, given its own problems. Amidst the ongoing euro area debt crisis, the Spanish government's rising budget deficit and the renewed recession, sovereign creditworthiness has declined. Spain's banking sector was also reeling from reports, officially denied, that worried customers were pulling deposits out of Bankia. As analysts at Investec comment, "It's not going to go down in history as a great day for Spanish banks." 7.38am: Asian markets were hit hard overnight by fears over the health of the Spanish banking sector, and the looming threat of a eurozone break-up. In Tokyo, the Nikkei fell by 2.99% at 8611.31, its lowest level since January. The index has now fallen for seven weeks in a row -- its worst performance since 2001. Hong Kong's Hang Seng index is down -2.69%. Ben Kwong , Hong Kong-based chief operating officer at KGI Asia, called it straight: It's really bad.... Fears of a Greek exit from the euro zone and the negative consequences from that are prevailing. Australian stocks were also hit overnight, particulaly banks and miners (with National Australia Bank falling 4.23%, and Rio Tinto down 5%). Warnings that China's economic growth might be lower than expected this year also hit sentiment. Chris Weston , institutional trader at IG, was also in bleak mood, predicting a "dark and tiresome open" in European markets. The world is bereft of good news 7.35am: Good morning, and welcome to our rolling coverage of the eurozone financial crisis . Not that there's much 'good' about this morning. The escalating crisis having sparked heavy losses in Asian stock markets overnight, and another sell-off expected in Europe today. There are two factors behind the sell-off: Fitch downgrading Greece yesterday evening on concerns that it might soon leave the eurozone and default, and Moody's decision to downgrade 16 Spanish banks . Those two developments capture the essence of the crisis today – Greece pushed to the brink of euro exit by austerity, a long recession and an huge debt mountain, and Spain battling to avoid the same fate. We'll be watching both countries today. World leaders are gathering in the US for the G8 summit, facing the growing threat of a global downturn. Barack Obama is expected to demand that Europe bows to pressure at home and abroad with new policies to boost growth . Eurozone crisis Euro Financial crisis Greece Stock markets Graeme Wearden guardian.co.uk © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds (3 h ago)

• UK 'may never fully recover' if Greece e... UK 'may never fully recover' if Greece exits euro
05/18/2012
Top forecaster says Britain would face long recession as key Greek politician frames crisis as people v capitalism A Greek exit from the single currency threatens to plunge Britain into a second recession equal in ferocity to the record postwar slump of 2008-09, according to the expert responsible for the government's economic forecasting. Robert Chote, chair of the Office for Budget Responsibility, who was speaking to the Guardian as world financial markets staggered to the end of a week that rekindled memories of the collapse of Lehman Brothers in 2008, warned that there was risk that a fresh downturn would do irreparable damage to the UK. Britain has made up less than half the ground lost when output plunged by more than 7% in 2008-09, and Chote said there was a risk that "you go down and you never quite get back up to where you started". In a separate exclusive interview , Alexis Tsipras, the increasingly powerful 37-year-old Greek politician now regarded by many as holding the future of the euro in his hands, told the Guardian that he was determined "to stop the experiment" with austerity policies imposed by Germany. He described the tax increases and spending cuts as a "crime against the Greek people". The leader of the Syriza party, whose success in last month's general election has led to political paralysis in Athens and a second general election, said he wanted Greece to stay in the euro, but was fighting capitalism. "On the one side there are workers and a majority of people, and on the other are global capitalists, bankers, profiteers on stock exchanges, the big funds. It's a war between peoples and capitalism ... it is the international financial system, and more especially banks, that are gaining most". The head of the UK's OBR said the deepening crisis in the eurozone could force him to tear up his forecasts, made only two months ago, that Britain would post modest growth of 0.8% this year. "The concern is that you end up with an outcome in the eurozone that creates the same sort of structural difficulties in the financial system and in the economy that we saw in the past recession, and that has consequences both for hitting economic activity in the economy, but also its underlying potential," said Chote. With economic output in the UK still 4% below its peak level when the recession began in early 2008, the prime minister and the governor of the Bank of England, Sir Mervyn King, have expressed concern in recent days about the vulnerability of Britain to the eurozone. Chote said he was particularly concerned about the possibility that a second deep recession would leave permanent scars. "That means not just that the economy weakens and then strengthens again – it goes into a hole and comes out – but that you go down and you never quite get back up to where you started." Shares in London closed down for a third week, with the jittery mood in financial markets pushing the FTSE 100 below 5,400 for the first time this year. German and French stock markets were also depressed, with even the much-anticipated stock market debut of Facebook in New York failing to lift spirits. Greece's caretaker prime minister, Panagiotis Pikramenos, said the German chancellor, Angela Merkel, had suggested in a phone call to the Greek president, Karolos Papoulias, on Friday that Greece hold a referendum on its continued membership of the single currency alongside next month's elections, in an apparent attempt to encourage voters to back mainstream parties who support the current austerity programme. The German government said that no suggestion of the kind had been made. But the Greek government was insistent, and said that Pikramenos had rejected the suggestion because he does not have the power to call a referendum. Merkel's finance minister, Wolfgang Schäuble, said the eurozone crisis could last two more years, while financial market speculation that Greece's days in the euro were numbered cast a shadow over the annual gathering of leaders of the G8 western industrial nations at Camp David. Canada's prime minister, Stephen Harper, voiced his frustration at Europe's leaders, demanding tough action to tackle the crisis. In Brussels, the European commission denied comments by Europe's trade minister, Karel de Gucht, that preparations were being made for Greece's departure from the single currency. Meanwhile, analysts at Deutsche Bank predicted that the weak state of Ireland's banks could result in the former Celtic tiger requiring a second bailout, and in Spain there were reports that the government would call in Goldman Sachs to help sort out its banks after 16 suffered credit downgrades on Thursday. In an echo of the months leading up to the Lehmans collapse, Mike Smith, chief executive of Australia and New Zealand Banking Group, said the turmoil in the eurozone meant Australian banks were being frozen out of money markets when seeking funds. Chote said there were so many uncertainties around what might happen with Greece and the eurozone that trying to produce firm predictions was not "particularly helpful". But the OBR has tried to quantify the impact of a disorderly sovereign debt restructuring in the eurozone on Britain – and the figures make grim reading. Britain would be plunged into recession for two years, according to the OBR analysis, published in its most recent economic and fiscal outlook report. There would also be deflation and unemployment would reach almost 11% by 2013-14, with debt subsequently reaching more than 90% of GDP. Chote said these projections were of limited value because the eurozone crisis could develop in so many different ways. "For example, one issue would be, do difficulties in the eurozone make it cheaper or more expensive for the UK government to borrow?" he said. "If it makes investors more nervous about risk in general, it might make it more expensive. If they see the UK as more of a safe haven, it might make it less expensive." Eurozone crisis Office for Budget Responsibility European Union European monetary union Economics Banking European banks Financial crisis Financial sector Euro Europe Greece Euro Economic policy Recession Andrew Sparrow Helena Smith Larry Elliott guardian.co.uk © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds (3 h ago)

• Letters: G8 leaders can help fight malnu... Letters: G8 leaders can help fight malnutrition
05/18/2012
David Cameron does indeed have a chance to act on global malnutrition this week at the G8 summit ( Wood shavings for dinner: G8 urged to tackle scourge of malnutrition , 17 May). However, millions will continue to die or suffer chronic malnourishment unless he and other world leaders stop giving financial and political support for the failed industrialised food system that has exacerbated hunger and environmental degradation. Barack Obama's plan for private-sector investment will bring scant comfort to our Mozambican partner, the national farmers' movement, União Nacional de Camponeses. Recent drives by Mozambique's government and World Bank policies to encourage private investment have lifted investors' rights above those of rural people. Moreover, private rural investment in many developing countries has not been shown to decrease poverty levels. On the contrary, this approach has encouraged land grabs, production of food and biofuels for export, as well as exploitation of workers, and worsened small-scale farmers' livelihoods. Cameron, Obama and their counterparts must drop the failed model of food security for food sovereignty, which requires agrarian reform in favour of small producers and the landless, and the reorganisation of global food trade to prioritise local markets and self-sufficiency. It also demands tougher curbs on global food chain firms, such as supermarkets, and the democratisation of international financial institutions. The right to food is a human right, not a welfare issue. Graciela Romero International programmes director, War on Want Malnutrition Food Poverty Farming Mozambique Africa G8 World Bank Biofuels guardian.co.uk © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds (3 h ago)

• Simon Hoggart's week: Obama rapped for t... Simon Hoggart's week: Obama rapped for the euro crisis
05/18/2012
Some blame the US president for stifling growth in the eurozone by keeping the dollar artificially low ✒I rang my American friend who's a banker in Switzerland to ask him about the euro crisis. He's a Democrat, but he blames Obama for keeping the dollar artificially low. Europe can't grow at the necessary speed while the US and the Chinese are undercutting them. Only part of the story, I know, but we do tend, on this side of the Atlantic, to believe that Obama is some kind of saint. ✒ My dad's best friend, Sir Roy Shaw , died this week. They had known each other since they were young men out of university, more than 70 years ago. They both came from similar backgrounds, poor families in Yorkshire. They had very similar views on the important things: that the best art should be available to everyone, and that the march of the "give the people what they want provided it makes money for us" gang had to be resisted. Like all best-friend relationships, theirs was prickly and at times in cold storage, a source of regret to both men. For example, Roy became secretary general of the Arts Council, a job that brings a pretty much automatic knighthood. He accepted his; Dad let all his family and friends know that he hadn't even let his name go forward for consideration. Prolier than thou, I suppose, though my Dad with a knighthood would have felt wrong, like the time he drove a Jaguar – a lovely car, but somehow not him. I suppose you always have an ambiguous relationship with your parents' best friends. They're family but not family; there's a fine line which is hard not to cross sometimes. Roy could be prescriptivist. He and Dad always took strong moral views about most things; convinced they were right, they often had little time for people who felt differently – especially if they wanted to foist rubbish on the masses. But I'm grateful to Roy for many things. He spread the word about the comeback of Max Wall, and seeing him was a joy. He also had a sometimes caustic view of the people who suckle at the Arts Council teat. Theatre people, I fear, tend to exaggerate the love and affection they inspire in the general public, and Roy would have none of that, to their occasional anger and incredulity. I used to write about theatre for the Guardian in the north, and there would sometimes be a phone call: "I see you've been taken in by X again – whatever he tells you, that last production was a disaster." Part of all my family's past as well as his own has gone with him. ✒ We had a wonderful weekend in Wales. After weeks of cloud and rain, a yellow orb appeared in the sky. I assumed it was a UFO, and indeed it disappeared just as mysteriously on Sunday. We were in St Davids, still Britain's smallest city, with a population half that of the next smallest, St Asaph. It's where St David was born to his mother, St Non, and you can visit the ruins of the building where this allegedly happened. It's surrounded by cows. I had a drink from the holy stream there, but it hasn't done much good yet. We walked along the magnificent coastal path, past cormorants and seal rocks and people in crash helmets abseiling down the sheer cliff faces, for no apparent reason. The sun glittered on the waves, the gorse was a flaming yellow, and clumps of wild flowers had begun to appear like scatter cushions. The cathedral sits under the city, so you have a spectacular aerial view from the streets. We ate lunch in a pub garden, and a host of jackdaws swooped down to eat the chips we threw. I may have mentioned this before, but St David was christened by St Elvis. This is perfectly true, and I don't think it's a coincidence that the Preseli mountains are nearby. The singer even looked Celtic, with a swarthy complexion and black hair. You can visit the tiny chapel on the clifftop, but Elvis was never in that particular building. ✒Stuck on a London tube crawling along at 5mph, little above walking speed, due to faulty rails, I wondered what it would be like if other businesses were conducted with the same insouciant incompetence as Transport for London (I apologise to non-metropolitan readers, though you'll get a lot more of this if transport at the Olympics goes horribly wrong). The Guardian, for example, even though this Saturday edition costs the same as the shortest tube ride. Whole sections would not appear at weekends. Some people would get their copy hours after they had left for work. Days would pass when the Guardian didn't appear at all, or else you'd have to share it with any other readers in your neighbourhood. Times when it all went right would be cause for celebration. ✒ What James Bond drank before product placement, part 3. Dick Hadfield went on a real anorak's website and discovered that in all Fleming's books Bond has 317 alcoholic drinks, roughly one every seven pages. They include 101 whiskies, rather more bourbons than scotch, just 19 vodka martinis, 16 gin martinis, and 30 glasses of champagne, plus 37 slugs of sake, all in You Only Live Twice, and not a single can of fizzy lager. ✒I spotted this sign myself in a service station near Cardiff: "Alcohol purchased at this service station cannot be consumed inside or outside the premises." I was tempted to buy some and try to sneak it home, but then I'm a law-abiding sort of person. ✒ One-liners: I rang the council to ask if I could have a skip outside my house. The bloke said: "You can cartwheel round the block for all I care." One of Ken Livingstone's pets was really upset when he lost the election to Boris. So he gave him Valium – now he's a calmer chameleon. I was sorry to miss Vidal Sassoon's funeral, but at least they had the highlights on TV. Euro European Union Economics Europe Financial crisis Banking Financial sector Eurozone crisis European monetary union European banks Arts Council England Transport policy Transport London Underground Wales Simon Hoggart guardian.co.uk © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds (3 h ago)

• Greek leftist leader Alexis Tsipras: 'It... Greek leftist leader Alexis Tsipras: 'It's a war between people and capitalism'
05/18/2012
Greece's eurozone fate may now be in the hands of the 37-year-old political firebrand and his Syriza party "I don't believe in heroes or saviours," says Alexis Tsipras, "but I do believe in fighting for rights … no one has the right to reduce a proud people to such a state of wretchedness and indignity." The man who holds the fate of the euro in his hands – as the leader of the Greek party willing to tear up the country's €130bn (£100bn) bailout agreement – says Greece is on the frontline of a war that is engulfing Europe. A long bombardment of "neo-liberal shock" – draconian tax rises and remorseless spending cuts – has left immense collateral damage. "We have never been in such a bad place," he says, sleeves rolled up, staring hard into the middle distance, from behind the desk that he shares in his small parliamentary office. "After two and a half years of catastrophe Greeks, are on their knees. The social state has collapsed, one in two youngsters is out of work, there are people leaving en masse, the climate psychologically is one of pessimism, depression, mass suicides." But while exhausted and battle weary, the nation at the forefront of Europe's escalating debt crisis and teetering on the edge of bankruptcy is also hardened. And, increasingly, they are looking towards Tsipras to lead their fight. "Defeat is the battle that isn't waged," says the young politician who almost overnight has seen his radical left coalition party, Syriza, jump from representing fewer than 5% of Greeks to enjoying ratings of more than 25% in polls. "You ask me if I am afraid. I'd be afraid if we continued on this path, a path to social hell … when someone fights there is a big chance that he will win and we are fighting this to win." Before Greeks went to the polls on 6 May, neither Tsipras nor his party were a name to be reckoned with. If anything both were the butt of vague mockery: a former pony-tailed student communist leading a rag-tag band of ex-Trotskyists, Maoists, champagne socialists and greens. Tsipras's assistants – wielding Louis Vuitton bags and fashionable sunglasses – readily admit they are signed up "militants" mostly of the anti-globalisation cause. But today I am the third person to pass through Tsipras's second-floor parliamentary office. The others have been the German ambassador to Greece and the president of the European parliament, Martin Schulz. As Greeks prepare to head to the polls again on 17 June, Tsipras, the politician poised to win the greatest number of votes – after Syriza came in second place in this month's inconclusive election – is the man everyone wants to see. "He is not as dangerous as he appears on TV, but he does have some risky positions," says Schulz emerging form the talks. "The [upcoming] vote in Greece will decide not just what happens here but what will happen internationally", adds the German before saying what he really wants to say. "If the memorandum [loan agreement] is cast in doubt, the payment [of rescue funds from the EU and IMF] to Greece is cast in doubt." Tsipras, who turns 38 in July, wants me to know that the war is not personal. The enemy is not Berlin, until now the biggest provider of the monumental rescue funds keeping the debt-stricken economy afloat. "It is not between nations and peoples," he says. "On the one side there are workers and a majority of people and on the other are global capitalists, bankers, profiteers on stock exchanges, the big funds. It's a war between peoples and capitalism … and as in each war what happens on the frontline defines the battle. It will be decisive for the war elsewhere." Greece, he says, has become a model for the rest of Europe because it was the first country to fall victim to the enforcement of hard-hitting "growth through austerity" policies pursued in the name of resolving the crisis. "It was chosen as the experiment for the enforcement of neo-liberal shock [policies] and Greek people were the guinea pigs," he insists. "If the experiment continues, it will be considered successful and the policies will be applied in other countries. That's why it is so important to stop the experiment. It will not just be a victory for Greece but for all of Europe." Under the current rescue plan, which has subjected the nation to relentless austerity – the average Greek's purchasing power has dropped by 35% – the international financial system, and especially banks, are gaining most, he says. "Who is surviving, tell me?" he asks. "Greeks aren't … The loans are going straight to interest payment and banks." The other point that Tsipras wants to make is that he is not against the euro or monetary union. Fears that the country is about to exit the eurozone are about terrorising people to keep the status quo, he claims. They are why the nation has seen "more then €75bn" of cash taken out of Greek banks since the outbreak of the crisis in Athens in December 2009. But Angela Merkel, the German chancellor, should know she has "a huge historical responsibility" – a point he will be making when he holds talks with representatives of the German government in Berlin next week. "We are not against a unified Europe or monetary union," he insists. "We don't want to blackmail, we want to persuade our European partners that the way that has been chosen to confront Greece is totally counter-productive. It is like throwing money at a bottomless pit." Over the past two years, Athens had received two bumper bailouts from the EU and IMF: €110bn in May 2010 and then €130bn in March this year, but the stringent fiscal adjustment programmes demanded in return for the aid are clearly not working, he says. If the emphasis is not now put on re-energising Europe's most moribund economy through development and growth, "in six months we will be forced to discuss a third package and after that a fourth," he predicts, "European tax payers should know that if they are giving money to Greece, it should have an effect … it should go towards investments and underwriting growth so that the Greek debt problem can be confronted because with this recipe we are not confronting the debt problem, the real issue." All this sounds remarkably toned down from the fiery rhetoric Tsipras has come to be associated with – until, that is, the mention of rescue funds drying up if (as seems likely) his party emerges as the governing force in a hung parliament. The first thing Syriza will do in power is tear up the controversial "memorandum of understanding" Greece signed up to with creditors, which details the onerous conditions under which the country receives quarterly injections of cash. The agreement, he says, was reached without the Greek people ever being consulted. And now in the wake of the 6 May vote, when more than 70% of those opposing the policies voted for "anti-bailout" parties, it is clear it has lost all legitimacy, he insists It is a high stakes game but, he argues, Europe is holding the gun because ultimately, under European law, Greece can't be ejected from the 17-nation bloc. "Europeans have to understand that we don't have any intention of pushing ahead with a unilateral move. We will [only] be forced to act if they act unilaterally and make the first move," he says. "If they don't pay us, if they stop the financing [of loans] then we will not be able to pay creditors. What I am saying is very simple." And if Athens stops paying its creditors, the problem then takes on a different hue. Greece is in a much stronger position than most think. "Keynes said it many years ago. It's not just the person who borrows but the person who lends who can find himself in a difficult position. If you owe £5,000 to the bank, it's your problem but if you owe £500,000, it's the bank's problem," he said. "This is a common problem. It's our problem. Its Merkel's problem. It's a European problem. Its a world problem." With his good looks, raven black hair and propensity for rousing oratory, Tsipras comes across more as a pin-up (which is how many in Greece see him) than a saviour, which is how a great deal of others see him. His aides add in passing that one of his heroes is Venezuelan leader Hugo Chávez, with whom he shares the same birthday. Nor does he believe in political tags "at this time of crisis". But though he appears to be preparing for power and moderating his tone, he says the war will continue. Greece Eurozone crisis Europe European Union European monetary union Economics Banking European banks Financial crisis Financial sector Euro Helena Smith guardian.co.uk © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds (4 h ago)

• G8 summit: French €57bn financial tax pl... G8 summit: French €57bn financial tax plan rejected by UK
05/18/2012
Eurozone set to dominate talks, with Obama caught between two competing visions of how to solve crisis Barack Obama was caught between two competing European visions of how to solve the financial crisis at the G8 summit when David Cameron rejected outright a French proposal to raise €57bn (£46bn) through a tax on financial transactions. The eurozone crisis is set to dominate four days of intense diplomacy which began in Washington Friday morning and continued through a meeting of G8 leaders at the presidential retreat Camp David on Friday evening. Discussions will continue there on Saturday and on to a Nato meeting in Chicago. In talks at the White House, only hours before the Camp David summit, Obama met the new French president, François Hollande, for a one-to-one conversation in which he explored the possibility of a new approach to the eurozone crisis based on a pro-growth, stimulus strategy. Obama has been pressing for such a strategy for the past three years and has a potential ally in Hollande. The White House welcomed what it sees as a change in the debate since Hollande's election that tilts the balance slightly more in favour of a growth strategy. The French president is proposing an EU-wide financial transaction tax (FTT) that could raise up to €57bn a year that could be used to stimulate the 27-nation bloc. After meeting Obama, Hollande was scheduled to meet David Cameron in Washington before flying to Camp David. However on arriving in the US, Cameron said: "On the financial transactions tax I'm very clear. We are not going to get growth in Europe or Britain by introducing a new tax that would actually hit people as well as financial institutions. I don't think it is a sensible measure. I will not support it." Cameron pointedly backed Hollande's conservative rival, Nicolas Sarkozy, in the presidential election and refused to meet Hollande in London during the campaign. However, the prime minister has now been trying to forge an alliance with the new French government to press Germany to do more to solve the euro crisis. The FTT is proving a sticking point between them. In his meeting with Obama, Hollande hinted at a compromise over his election pledge to pull French combat troops out of Afghanistan early. The US and Britain fear a premature exit by France could also send other countries rushing to the exit ahead of the 2014 deadline for withdrawal. At the White House, Hollande insisted he was standing by his pledge but left the door open for a compromise. He said he was committed to providing assistance on Afghan security but in a different way and this would be discussed at the Nato summit held in Chicago on Sunday and Monday. It is thought Hollande and Obama discussed French troops switching to a training role. Obama was looking for a good relationship with Hollande, hoping to enlist him as an ally in support of the US push for a pro-growth/stimulus approach to the eurozone crisis. The two appeared to get along, with Obama teasing Hollande about having studied fast food. Hollande said he had nothing against "cheeseburgers", prompting Obama to add lamely that cheeseburgers "go very good with French fries". The G8 leaders were set to discuss national security issues such as Syria and Iran over dinner and aid for the developing world in the morning. But the bulk of the time was being devoted to the European crisis. It is the first time a US president has gathered so many leaders at the relatively small Camp David venue. Most meetings normally involve invitations to just one or two others. With space at a premium, each of the G8 leaders has been assigned a cabin and they will gather for discussions around a communal dining table. As well as Hollande, Cameron and Germany's Angela Merkel, there will be Canada's prime minister, Stephen Harper, the Italian prime minister, Mario Monti, the Japanese prime minister, Yoshihiko Noda, and the Russian prime minister, Dmitri Medvedev, who is attending in place of the Russian president, Vladimir Putin. Although there is little motivation in either the G8 or Nato for military intervention in Syria, Cameron is to call for more military observers to be sent to Syria. He is offering to send a senior Ministry of Defence official at colonel rank to act as chief of staff to General Robert Mood, the chief military observer at the UN supervision mission in Syria. In a speech in Washington that kicked off the weekend of diplomacy, Obama announced $3bn (£2bn) in new money to help tackle hunger, mainly projects to help small farmers in Africa. Crucially, however, the cash is to come from the private sector. There has been no announcement yet about whether there will be any funds from the G8 countries on top of the $22bn they committed in 2009 to deal with hunger over the following three years. Obama said it was important the G8 focused on "the urgent challenge that confronts some 1 billion men, women and children around the world – the injustice of chronic hunger". He added: "As the wealthiest nation on earth, I believe the United States has a moral obligation to lead the fight against hunger and malnutrition, and to partner with others." Oxfam expressed concern that Obama's announcement "focuses too heavily on the role of the private sector to tackle the complex challenges of food insecurity in the developing world". It called on the G8 to commit substantial funds. G8 Eurozone crisis Financial crisis Economics Banking Financial sector European Union European monetary union European banks Euro Europe France United States Barack Obama François Hollande David Cameron Patrick Wintour Ewen MacAskill guardian.co.uk © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds (4 h ago)

• How the poor are made to pay for their p... How the poor are made to pay for their poverty | Barbara Ehrenreich
05/18/2012
Even the government now has discovered that pauperising people who already have little can still be a profitable business Individually, the poor are not too tempting to thieves, for obvious reasons. Mug a banker and you might score a wallet containing a month's rent. Mug a janitor and you will be lucky to get away with bus fare to flee the crime scene. But as Businessweek helpfully pointed out in 2007, the poor in aggregate provide a juicy target for anyone depraved enough to make a business of stealing from them. The trick is to rob them in ways that are systematic, impersonal, and almost impossible to trace to individual perpetrators. Employers, for example, can simply program their computers to shave a few dollars off each paycheck, or they can require workers to show up 30 minutes or more before the time clock starts ticking. Lenders, including major credit companies as well as payday lenders, have taken over the traditional role of the street-corner loan shark, charging the poor insanely high rates of interest. When supplemented with late fees (themselves subject to interest), the resulting effective interest rate can be as high as 600% a year, which is perfectly legal in many states. It's not just the private sector that's preying on the poor. Local governments are discovering that they can partially make up for declining tax revenues through fines, fees, and other costs imposed on indigent defendants, often for crimes no more dastardly than driving with a suspended license. And if that seems like an inefficient way to make money, given the high cost of locking people up, a growing number of jurisdictions have taken to charging defendants for their court costs and even the price of occupying a jail cell. The poster case for government persecution of the down-and-out would have to be Edwina Nowlin, a homeless Michigan woman who was jailed in 2009 for failing to pay $104 a month to cover the room-and-board charges for her 16-year-old son's incarceration. When she received a back paycheck, she thought it would allow her to pay for her son's jail stay. Instead, it was confiscated and applied to the cost of her own incarceration. Government joins the looters of the poor You might think that policymakers would take a keen interest in the amounts that are stolen, coerced, or extorted from the poor, but there are no official efforts to track such figures. Instead, we have to turn to independent investigators, like Kim Bobo, author of Wage Theft in America , who estimates that wage theft nets employers at least $100bn a year and possibly twice that. As for the profits extracted by the lending industry, Gary Rivlin, who wrote Broke USA: From Pawnshops to Poverty, Inc – How the Working Poor Became Big Business , says the poor pay an effective surcharge of about $30bn a year for the financial products they consume and more than twice that if you include sub-prime credit cards, sub-prime auto loans, and sub-prime mortgages. These are not, of course, trivial amounts. They are on the same order of magnitude as major public programs for the poor. The government distributes about $55bn a year, for example, through the largest single cash-transfer program for the poor, the Earned Income Tax Credit ; at the same time, employers are siphoning off twice that amount , if not more, through wage theft. And while government generally turns a blind eye to the tens of billions of dollars in exorbitant interest that businesses charge the poor, it is notably chary with public benefits for the poor. Temporary Assistance to Needy Families, for example, our sole remaining nationwide welfare program, gets only (pdf) $26bn a year in state and federal funds. The impression is left of a public sector that's totally self-contradictory: on the one hand, offering safety net programs for the poor; on the other, enabling large scale private sector theft from the very people it is supposedly trying to help. At the local level though, government is increasingly opting to join in the looting. In 2009, a year into the Great Recession, I first started hearing complaints from community organizers about ever more aggressive levels of law enforcement in low-income areas. Flick a cigarette butt and get arrested for littering; empty your pockets for an officer conducting a stop-and-frisk operation and get cuffed for a few flakes of marijuana. Each of these offenses can result, at a minimum, in a three-figure fine. And the number of possible criminal offenses leading to jail and/or fines has been multiplying recklessly. All across the country – from California and Texas to Pennsylvania – counties and municipalities have been toughening laws against truancy and ratcheting up enforcement, sometimes going so far as to handcuff children found on the streets during school hours. In New York City, it's now a crime to put your feet up on a subway seat, even if the rest of the car is empty, and a South Carolina woman spent six days in jail when she was unable to pay a $480 fine for the crime of having a "messy yard". Some cities – most recently, Houston and Philadelphia – have made it a crime to share food with indigent people in public places. Being poor itself is not yet a crime, but in at least a third of the states, being in debt can now land you in jail . If a creditor like a landlord or credit card company has a court summons issued for you and you fail to show up on your appointed court date, a warrant will be issued for your arrest. And it is easy enough to miss a court summons, which may have been delivered to the wrong address or, in the case of some bottom-feeding bill collectors, simply tossed in the garbage – a practice so common that the industry even has a term for it: "sewer service". In a sequence that National Public Radio reports is "increasingly common", a person is stopped for some minor traffic offense – having a noisy muffler, say, or broken brake light – at which point, the officer discovers the warrant and the unwitting offender is whisked off to jail. Local governments as predators Each of these crimes, neo-crimes, and pseudo-crimes carries financial penalties as well as the threat of jail time, but the amount of money thus extracted from the poor is fiendishly hard to pin down. No central agency tracks law enforcement at the local level, and local records can be almost willfully sketchy. According to one of the few recent nationwide estimates, from the National Association of Criminal Defense Lawyers, 10.5m misdemeanors were committed in 2006. No one would risk estimating the average financial penalty for a misdemeanor, although the experts I interviewed all affirmed that the amount is typically in the "hundreds of dollars". If we take an extremely lowball $200 per misdemeanor, and bear in mind that 80-90% of criminal offenses are committed by people who are officially indigent, then local governments are using law enforcement to extract, or attempt to extract, at least $2bn a year from the poor. And that is only a small fraction of what governments would like to collect from the poor. Katherine Beckett, a sociologist at the University of Washington, estimates that "deadbeat dads" (and moms) owe (pdf) $105bn in back child-support payments, about half of which is owed to state governments as reimbursement for prior welfare payments made to the children. Yes, parents have a moral obligation to their children, but the great majority of child-support debtors are indigent. Attempts to collect from the already-poor can be vicious and often, one would think, self-defeating. Most states confiscate the drivers' licenses of people owing child support, virtually guaranteeing that they will not be able to work. Michigan just started suspending the drivers' licenses of people who owe money for parking tickets. Las Cruces, New Mexico, just passed a law that punishes people who owe overdue traffic fines by cutting off their water, gas, and sewage. Once a person falls into the clutches of the criminal justice system, we encounter the kind of slapstick sadism familiar to viewers of Wipeout. Many courts impose fees without any determination of whether the offender is able to pay, and the privilege of having a payment plan will itself cost money. In a study of 15 states, the Brennan Center for Justice at New York University found 14 of them contained jurisdictions that charge a lump-sum "poverty penalty" of up to $300 for those who cannot pay their fees and fines, plus late fees and "collection fees" for those who need to pay over time. If any jail time is imposed, that too may cost money, as the hapless Edwina Nowlin discovered, and the costs of parole and probation are increasingly being passed along to the offender. The predatory activities of local governments give new meaning to that tired phrase "the cycle of poverty". Poor people are far more likely than the affluent to get into trouble with the law, either by failing to pay parking fines or by incurring the wrath of a private sector creditor like a landlord or a hospital. Once you have been deemed a criminal, you can pretty much kiss your remaining assets goodbye. Not only will you face the aforementioned court costs, but you'll have a hard time ever finding a job again once you've acquired a criminal record. And then, of course, the poorer you become, the more likely you are to get in fresh trouble with the law, making this less like a "cycle" and more like the waterslide to hell. The further you descend, the faster you fall – until you eventually end up on the streets and get busted for an offense like urinating in public or sleeping on a sidewalk. I could propose all kinds of policies to curb the ongoing predation on the poor. Limits on usury should be reinstated. Theft should be taken seriously even when it's committed by millionaire employers. No one should be incarcerated for debt or squeezed for money they have no chance of getting their hands on. These are no-brainers, and should take precedence over any long term talk about generating jobs or strengthening the safety net. Before we can "do something" for the poor, there are some things we need to stop doing to them. Poverty United States US economy Banking US politics Barbara Ehrenreich guardian.co.uk © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds (4 h ago)

• Video: IPO makes Facebook employees mill... Video: IPO makes Facebook employees milllionaires
05/19/2012
It's estimated that Facebook's introduction to the stock market made one thousand of its employees millionaires. John Blackstone reports. (1 h ago)

• Video: Facebook frenzy on Wall Street Video: Facebook frenzy on Wall Street
05/19/2012
Investors poured billions of dollars into Facebook's IPO, but the price of the brand-new stock barely moved, reports Anthony Mason. (1 h ago)

• Facebook IPO: Trading glitch sullies Nas... Facebook IPO: Trading glitch sullies Nasdaq
05/18/2012
Nasdaq is reportedly investigating trading in the social networking's initial public offering was delayed by 30 minutes (2 h ago)

• Facebook tax loophole draws fire Facebook tax loophole draws fire
05/18/2012
Critics of the social networking company's say the company plans to dodge federal income taxes (3 h ago)

• Facebook IPO: Meet the millionaires and ... Facebook IPO: Meet the millionaires and billionaires
05/18/2012
Even at the IPO price of $38, Facebook will make some people very, very wealthy (3 h ago)

• Facebook IPO: Lackluster trading after a... Facebook IPO: Lackluster trading after all the hype
05/18/2012
Whether the Facebook IPO was a "dud" or the ultimate exit strategy, the social media giant has a lot of work to do (3 h ago)

• Lack of trust in Facebook may hold back ... Lack of trust in Facebook may hold back ad sales
05/18/2012
Users' distrust limits the value of the site's ads; advertisers want to target their messages to the people most likely to respond to them (4 h ago)

• Video: Facebook IPO: What happens next? Video: Facebook IPO: What happens next?
05/18/2012
MoneyWatch's Jill Schlesinger and Jack Otter discuss the hype behind the Facebook IPO and whether it is worth it to invest. (4 h ago)

• Video: Bringing color and hope to NYC sc... Video: Bringing color and hope to NYC schools
05/18/2012
Every so often we hear about a flash of brilliance. Sometimes it's a million dollar idea. Sometimes it's a plan to change the world. In this case, it's both. Alexis Christoforous reports. (5 h ago)

• The Facebook IPO The Facebook IPO
05/18/2012
See images from Facebook's May 18 public stock offering (6 h ago)

• Facebook IPO: More whimper than bang Facebook IPO: More whimper than bang
05/18/2012
Kicking off its long-awaited IPO, the social networking company's stock price fails to ignite in early trading (7 h ago)

• Veterans' unemployment -- a national dis... Veterans' unemployment -- a national disgrace
05/18/2012
Too many veterans are returning home unable to find work, even when suitable jobs are available -- we should be ashamed (7 h ago)

• Why is the EU denying planning for Greek... Why is the EU denying planning for Greek exit?
05/18/2012
Instead of calming fears, denial just creates more doubt (8 h ago)

• Hotly anticipated Facebook IPO takes off Hotly anticipated Facebook IPO takes off
05/18/2012
With investors watching Facebook's IPO closely, the company debuted on the NASDAQ Friday morning with an initial share price of $38 (8 h ago)

• Video: Facebook's Zuckerberg rings NASDA... Video: Facebook's Zuckerberg rings NASDAQ bell on day of IPO
05/18/2012
Facebook co-founder and CEO Mark Zuckerberg rang the New York-based NASDAQ's opening bell from Facebook's Silicon Valley campus Friday -- the day of Facebook's long-awaited initial public offering. (9 h ago)

• Why I quit my job without a new one line... Why I quit my job without a new one lined up
05/18/2012
Ever wonder what makes someone just up and quit? (11 h ago)

• 7 things high school sophomores should b... 7 things high school sophomores should be doing
05/18/2012
For high school sophomores, it's not too early to start thinking about college (11 h ago)

• European woes keep markets on edge European woes keep markets on edge
05/18/2012
Concerns that Europe's debt crisis could drag down parts of the continent's banking system rattled most global markets Friday (11 h ago)

• Oil hovers below $93 after sharp 2-week ... Oil hovers below $93 after sharp 2-week sell-off
05/18/2012
Crude has plunged about 13 percent from $106 two weeks ago because of expectations Europe's debt crisis will slow the global economy (11 h ago)

• Facebook IPO burns, Europe smolders Facebook IPO burns, Europe smolders
05/18/2012
As Facebook garners the spotlight, investors are missing the big story: The Greek drama in Europe (12 h ago)

• Facebook's IPO fails to live up to the h... Facebook's IPO fails to live up to the hype
05/18/2012
After jumping more than 10 percent at the start of trading, shares of the social network pulled back in their debut on the Nasdaq stock market Friday to gain a mere 23 cents a share. (2 h ago)

• GM won't advertise on next Super Bowl GM won't advertise on next Super Bowl
05/18/2012
General Motors does not plan to run ads on the next Super Bowl as it revamps its global marketing operations to cut about $2 billion from its budget. (3 h ago)

• Stock market falls as Facebook makes sha... Stock market falls as Facebook makes shaky debut
05/18/2012
Stocks fell on Friday as Facebook made a shaky debut and finished its first day of trading little changed from its IPO price. Broad market indexes were sharply lower as turned cautious before leaders of the Group of Eight nations met to dicsuss the eurozone debt crisis. (3 h ago)

• Record-breaking $90 million penthouse sa... Record-breaking $90 million penthouse sale in N.Y.
05/18/2012
What real estate downturn? A two-level penthouse with sweeping views of Central Park just sold for more than $90 million — a record price for New York, according to the New York Times. (4 h ago)

• Facebook IPO volume = headaches for Nasd... Facebook IPO volume = headaches for Nasdaq
05/18/2012
The weight of Facebook's popularity seemed to bog down the Nasdaq in the initial minutes of the social network's debut trading. (4 h ago)

• Celebrity Real Estate: Seacrest and Elle... Celebrity Real Estate: Seacrest and Ellen deal
05/18/2012
The big real estate news in celebrity circles? Ellen DeGeneres finally sold her home, selling it to fellow star Ryan Seacrest, and Jennifer Aniston and Justin Theroux are renting in Beverly Hills while their modern home is renovated. (5 h ago)

• 7-Eleven serving up diet Slurpees for th... 7-Eleven serving up diet Slurpees for the first time
05/18/2012
It probably says something more about America than it does about 7-Eleven, but starting this month the retailer is rolling out a product that seems right for its time: a sugar-free Slurpee. (5 h ago)

• How Facebook is friendly to its employee... How Facebook is friendly to its employees
05/18/2012
If you just bought shares in Facebook or are considering doing so, you probably want to know what the company is doing to keep its employees happy. (7 h ago)

• Buzz: Working women's woes: looks, child... Buzz: Working women's woes: looks, child care
05/18/2012
We’re going to go out on a limb and guess that when Henry Kissinger served as secretary of state, press reports about his key trips to foreign countries did not usually dwell on how he looked. No such luck for Hillary Clinton. (7 h ago)

• Facebook shares trim gains after early p... Facebook shares trim gains after early pop
05/18/2012
Shares of Facebook rose early in the market debut of one of the most anticipated initial public offerings ever. But they soon lost some of their pop. (7 h ago)

• Here's who is getting rich off Facebook'... Here's who is getting rich off Facebook's IPO
05/18/2012
When Facebook priced its initial public offering Thursday, the event created hundreds of instant millionaires and a few billionaires. Topping the list, of course, is founder and CEO Mark Zuckerberg, who sold $1.1 billion worth of shares and saw his remaining stake valued at $19. (8 h ago)

• Yes, you can get a good job without coll... Yes, you can get a good job without college
05/18/2012
Rick Santorum got a lot of heat earlier this year for suggesting not everyone needs a college degree, but he may have been on to something. There are lots of jobs out there that don’t require a four-year degree and pay pretty well. (8 h ago)

• Facebook CEO Zuckerberg opens trading at... Facebook CEO Zuckerberg opens trading at Nasdaq
05/18/2012
Facebook’s founder and CEO Mark Zuckerberg rang the opening bell at the Nasdaq stock market Friday, signaling the start of share dealing in the U.S. (10 h ago)

• Review: 4-cylinder Ford Escape strikes t... Review: 4-cylinder Ford Escape strikes the right tone
05/18/2012
We’ve seen this movie before: Stagnant economy. Soaring gas prices. Government-mandated increases in fuel economy that doom the big vehicles Americans prefer. In the 1970s, automakers responded to those conditions with that they called “downsizing. (10 h ago)

• NYT: Silicon Valley riches kept on the d... NYT: Silicon Valley riches kept on the down low
05/18/2012
Make no mistake. In this, Silicon Valley’s gilded age, money is chasing money. You just have to know where to look to see it. (11 h ago)

• Cities where jobs in manufacturing pay t... Cities where jobs in manufacturing pay the most
05/18/2012
Not all manufacturing jobs are created equal -- and certainly not manufacturing pay. According to a new study released by Brookings’ Metropolitan Policy Program, manufacturing wages differ widely between large cities. (12 h ago)

• Getting older and going, or going back, ... Getting older and going, or going back, to work
05/18/2012
The tough job market has been so hard on some Americans that they have dropped out of the running altogether. But here’s a surprising twist: Generally, that’s not been true of older Americans. (12 h ago)

• JPMorgan trading losses likely growing JPMorgan trading losses likely growing
05/17/2012
JPMorgan Chase has acknowledged losing at least $2 billion on a series of risky trades, and now that sea of red ink appears to be rising. (1 d ago)

• Boy finds a piece of finger in Arby's sa... Boy finds a piece of finger in Arby's sandwich
05/17/2012
A Michigan teen made a gristly discovery after biting into an Arby's junior roast beef sandwich. (1 d ago)

• Here's how you get a piece of Facebook Here's how you get a piece of Facebook
05/17/2012
Excitement is mounting for Facebook’s expected debut on financial markets Friday. So if you’re an individual investor, can you get a piece of the action, and should you? (1 d ago)

• From little white to blatant: Lies are l... From little white to blatant: Lies are lies
05/18/2012
We all tell little lies -- politeness practically dictates that we do. But there are some serious consequences when even small lies enter your resume. (37 m ago)

• Nick Hanauer on the TED talk, income ine... Nick Hanauer on the TED talk, income inequality controversy
05/18/2012
The venture capitalist discusses his controversial TED talk, why income and inequality has become political and what happens next. (2 h ago)

• Hewlett-Packard reportedly will lay off ... Hewlett-Packard reportedly will lay off 30,000
05/18/2012
Hewlett-Packard reportedly will announce it is laying off nearly one out of every 10 employees, as Meg Whitman tries to transform one-time pioneer. (2 h ago)

• GM passes on Super Bowl advertising GM passes on Super Bowl advertising
05/18/2012
General Motors recently announced it was going to stop advertising on Facebook, and now it's bowing out of doing an expensive ad during the Super Bowl next year. (2 h ago)

• Letters: Brogrammers and older workers Letters: Brogrammers and older workers
05/18/2012
Going over listeners' responses to past broadcasts. This week: Defending the male work culture at tech companies, and wanting to know more about the older workers who are long-term unemployed. (3 h ago)

• Walmart expands its bribery investigatio... Walmart expands its bribery investigation
05/18/2012
Walmart said it is looking beyond Mexico for possible bribery in its foreign operations. Will the widening probe affect Walmart’s business? (3 h ago)

• Weekly Wrap: What happened to Facebook's... Weekly Wrap: What happened to Facebook's stock?
05/18/2012
Reviewing this week's headlines on Wall Street and beyond. This week: The first day of trading for the highly anticipated Facebook stock. (3 h ago)

• Obama to announce food initiative for wo... Obama to announce food initiative for world poor
05/18/2012
President Obama has enlisted the help of 45 private sector companies in a $3 billion food security drive to fight hunger and poverty in Africa. But not everyone is onboard. (4 h ago)

• Silicon Valley's new underground million... Silicon Valley's new underground millionaires
05/18/2012
Conspicuous consumption is so last tech boom. The new rich are all about meaning and making a difference and getting in on the ground floor of the next Facebook. (4 h ago)

• 'Supercommuters' board airplanes to get ... 'Supercommuters' board airplanes to get to work
05/18/2012
Think your commute is long? Turns out a rapidly growing number of commuters are flying to get to work. (4 h ago)

• Stockton on the brink Stockton on the brink
05/18/2012
The city of Stockton, Calif. has been hit hard by the financial crisis. With the city on the verge of bankruptcy, residents share what it's like when your town is teetering on the brink. (8 h ago)

• An app too far? An app too far?
05/18/2012
Apple's new Apple Store self-checkout app has Wired.com columnist Lore Sjoberg worried. (8 h ago)

• Gameshow dreamers: Come on down! Gameshow dreamers: Come on down!
05/18/2012
Tess Vigeland takes us behind the scenes at CBS's "The Price Is Right" to see how contestants are chosen. (9 h ago)

• ReMarket Podcast: The sounds you might n... ReMarket Podcast: The sounds you might never hear
05/18/2012
Step inside the control room and see what it's like as an audio producer assembling our shows. Plus, highlights from our interview with President Obama and "Git To Know A Brit" -- meet staff members hailing from the U.K. (9 h ago)

• PODCAST: The Facebook IPO arrives PODCAST: The Facebook IPO arrives
05/18/2012
Happy Facebook IPO Day! The company priced its IPO yesterday at $38 a share, for a market valuation of $104 billion. But just exactly how is Facebook going to live up to that market cap? On the table at the House of Representatives are big budget cuts for the military; one of the casualties of defense budget cutting is the $45 million Technology Innovation Program. The U.S. Commerce Department has announced steep tariffs on solar panels from China. And this year, the cost of going to prom is a bit higher than usual. (9 h ago)

• Chasing the mythical 8% return Chasing the mythical 8% return
05/18/2012
An old investing maxim is taken to task. (9 h ago)

• The initial launch of the Facebook IPO The initial launch of the Facebook IPO
05/18/2012
After opening later than expected, the first few hours of the Facebook IPO are suggesting that the company might have misjudged the value of its shares. (10 h ago)

• Government bond interest rates near all-... Government bond interest rates near all-time low
05/18/2012
The yield -- or interest rate -- on 10-year government bonds has fallen down to 1.7 percent, which is close to the all-time low. (10 h ago)

• Student protests heat up in Quebec Student protests heat up in Quebec
05/18/2012
In what's seen as the most intense student demonstrations in the history of Canada, students in Quebec have been protesting hikes in tuition since the winter. Now the government there is debating emergency legislation to temporarily close some universities and to levy penalties for protesting of as much as $35,000 for individuals, $125,000 for student organizations. (11 h ago)

• Protecting your portfolio from inflation Protecting your portfolio from inflation
05/18/2012
What's the best way to hedge against the risk of higher inflation rates? The timing is murky, but it's a prudent bet to anticipate a resurgence in inflation. (11 h ago)

• Sponsored By: Sponsored By:
05/18/2012
(8 h ago)

• JPMorgan's Dimon to testify before Senat... JPMorgan's Dimon to testify before Senate panel
05/17/2012
JPMorgan Chase CEO Jamie Dimon will be heading to Washington to testify before a Senate Committee investigating massive trading losses recently announced by the bank. (1 d ago)

• Sponsored By: Sponsored By:
05/17/2012
(1 d ago)

• HP considers 25,000 job cuts, sources sa... HP considers 25,000 job cuts, sources say
05/17/2012
Hewlett-Packard Co is considering cutting its workforce by 8 to 10 percent, or a minimum of 25,000 jobs, sources familiar with the matter told Reuters, as newly installed CEO Meg Whitman strives to return the storied Silicon Valley institution to growth. (1 d ago)

• Facebook looking at price of $38 a share... Facebook looking at price of $38 a share as IPO approaches
05/17/2012
Facebook was on the verge of going public Thursday at $38 a share, raising more than $16 billion in a landmark public offering that would value the company at more than $100 billion. (1 d ago)

• Postal service to close or consolidate 1... Postal service to close or consolidate 140 sites
05/17/2012
The U.S. Postal Service will move ahead with a plan to shut or consolidate mail-processing facilities as part of its cost-cutting effort but will spread out the closings to maintain overnight delivery of local mail. (1 d ago)

• Mark Zuckerberg, in 2004, about his new ... Mark Zuckerberg, in 2004, about his new website
05/17/2012
In this 2004 interview with Becky Quick, Mark Zuckerberg's talks about his new social media site -- a plucky startup called Facebook. (1 d ago)

• Mr. IPO: Facebook could be a dangerous b... Mr. IPO: Facebook could be a dangerous bet
05/17/2012
When a world-renowned expert on initial public offerings has reservations about the Facebook IPO, it’s worth sitting up and taking notice. (1 d ago)

• Goldman could make $1.09 billion in Face... Goldman could make $1.09 billion in Facebook IPO
05/17/2012
Goldman could be one of the biggest beneficiaries of the Facebook IPO. The investment bank plans to cash out 43 percent of its 65.9 million shares it owns in the social network. (1 d ago)

• Sponsored By: Sponsored By:
05/17/2012
(1 d ago)

• A Start-Up Is Gold for Facebook’s New Mi... A Start-Up Is Gold for Facebook’s New Millionaires
05/19/2012
At Facebook, ground zero for the nouveau tech riche in Silicon Valley, peer pressure dictates that consumption be kept on the down low. (1 h ago)

• Common Sense: The Undoing of Scott Thomp... Common Sense: The Undoing of Scott Thompson at Yahoo — Common Sense
05/19/2012
A faked résumé led to a victory for an activist shareholder, and an enduring mystery about Scott Thompson’s departure from Yahoo. (1 h ago)

• News Analysis: A Greek Exit? Euro Zone M... News Analysis: A Greek Exit? Euro Zone May Be Ready
05/19/2012
Years of foot-dragging and brinkmanship have prepared the currency union for life without Greece. (1 h ago)

• Greece and Germany in War of Words Over ... Greece and Germany in War of Words Over Euro Crisis
05/19/2012
A telephone conversation on Friday between Germany’s chancellor and Greece’s president became the latest flashpoint in the unfolding crisis over Greece’s membership in the euro. (1 h ago)

• Credit Flows Through a New Channel for E... Credit Flows Through a New Channel for Europe
05/19/2012
Companies in the euro zone are finding that they can bypass the uncertainties of local banks and obtain money in the bond market. (1 h ago)

• A Whisper of Nuclear War Spurs a Sell-Of... A Whisper of Nuclear War Spurs a Sell-Off in a Russian Stock Market
05/19/2012
Dmitri Medvedev, Russia’s prime minister, said he didn’t “want to scare anybody,” but the Micex stock exchange fell on both Thursday and Friday. (1 h ago)

• DealBook: After Buildup, a Modest Start ... DealBook: After Buildup, a Modest Start for Facebook
05/19/2012
While disappointing new investors who were betting on fast gains, Facebook had a wide winner's circle, creating huge paper gains for scores of early insiders, hundreds of employees and some stragglers who bought stakes recently. (1 h ago)

• DealBook: Facebook Shares End Day With S... DealBook: Facebook Shares End Day With Scant Gain
05/18/2012
After initially rising 11 percent on its first day, the stock closed at $38.23, just above its offering price, in heavy trading. (2 h ago)

• In Spain, Jobless Find a Refuge Off the ... In Spain, Jobless Find a Refuge Off the Books
05/18/2012
As the recession deepens, more workers are getting by on the black-market economy that amounts to as much as a fifth of the country’s gross domestic product. (5 h ago)

• U.S. Slaps Tariffs on Chinese Solar Pane... U.S. Slaps Tariffs on Chinese Solar Panels
05/18/2012
The United States Commerce Department concluded that Chinese producers had “dumped” their products on the American market. (5 h ago)

• Spain Tries to Calm Fears About Ailing L... Spain Tries to Calm Fears About Ailing Lender
05/18/2012
A week after Spain seized control of Bankia, the government was forced to deny that clients were scrambling to withdraw funds from the lender. (6 h ago)

• Iran Oil Production Drop Seen Iran Oil Production Drop Seen
05/18/2012
A 12 percent decline in the first three months of the year is at odds with Iran’s assessment that there has been no significant change in output over the past year. (6 h ago)

• ‘Princelings’ in China Use Family Ties t... ‘Princelings’ in China Use Family Ties to Gain Riches
05/18/2012
The authorities are eager to paint the fallen official Bo Xilai, whose family has a substantial fortune, as a rogue operator. But other officials’ relatives have also amassed vast wealth. (7 h ago)

• Wal-Mart Concedes Bribery Case May Widen Wal-Mart Concedes Bribery Case May Widen
05/18/2012
The scope of an investigation into foreign bribery issues seemed to have widened at the retailer, which reported higher-than-expected first-quarter earnings. (9 h ago)

• Building the Next Facebook a Tough Task ... Building the Next Facebook a Tough Task in Europe
05/18/2012
Unlike in the United States, where promising Internet startups can expect venture capitalists to come calling early, entrepreneurs in Europe face a shortage of financing. (14 h ago)

• DealBook: Ackman Wins Proxy Fight at Can... DealBook: Ackman Wins Proxy Fight at Canadian Pacific
05/17/2012
Before the company's annual meeting, Canadian Pacific announced that its president and chief executive, Fred Green, was stepping down and that its chairman and five other directors including Mr. Green would not stand for re-election. (1 d ago)

• DealBook: Names on the Witness List for ... DealBook: Names on the Witness List for Gupta’s Trial
05/17/2012
Possible witnesses who could be called to testify include Lloyd C. Blankfein, Goldman’s chief executive, and A.G. Lafley, the former chief executive of Procter & Gamble. (1 d ago)

• DealBook: Fitch Warns Banks Must Raise $... DealBook: Fitch Warns Banks Must Raise $566 Billion in New Capital
05/17/2012
New capital requirements are being implemented as the authorities press firms to hold more cash in reserve to protect against future financial shocks. (1 d ago)

• Economy Grows Faster Than Expected in Ja... Economy Grows Faster Than Expected in Japan
05/17/2012
The strong showing was the third consecutive quarter of growth for the nation and eclipsed the annualized 2.2 percent growth posted by the United States in the first quarter. (1 d ago)

• DealBook: Agilent to Buy Dako for $2.2 B... DealBook: Agilent to Buy Dako for $2.2 Billion
05/17/2012
Agilent Technologies, a maker of scientific instruments, has agreed to buy Dako, a Danish cancer diagnostics company, for $2.2 billion. (1 d ago)

• Bookshelf: Books on Rejected New Yorker ... Bookshelf: Books on Rejected New Yorker Covers, and the Guilt of Aaron Burr
05/19/2012
Three new books explore The New Yorker’s cover designs, the cultural influence of Samuel Rothafel and the struggles Aaron Burr faced after he shot Alexander Hamilton. (1 h ago)

• Character Study: James Crockman, the Hum... Character Study: James Crockman, the Human Antenna of the Breaking News Network
05/19/2012
James Crockman of the Breaking News Network.James Crockman listens to 17 police and fire frequencies from a New Jersey office to cull spot items for subscribers like news media outlets. (1 h ago)

• Michael Rosenbaum, CBS Producer, Dies at... Michael Rosenbaum, CBS Producer, Dies at 64
05/19/2012
The former Tel Aviv bureau chief for CBS News produced shows for “60 Minutes,” including the first television interview with the family of the Unabomber, Theodore J. Kaczynski. (1 h ago)

• Media Decoder Blog: Plagiarism Charge Ag... Media Decoder Blog: Plagiarism Charge Against Elizabeth Warren Made, Then Quickly Dropped
05/19/2012
The Corner blog of The National Review mixed up the original publication date of Ms. Warren's book. (1 h ago)

• Media Decoder Blog: The Drummer Vanishes Media Decoder Blog: The Drummer Vanishes
05/18/2012
A feud among the members of the heavy-metal band Black Sabbath has left the original drummer, Bill Ward, out of its reunion concerts and cut out of its photographs. (1 h ago)

• Media Decoder Blog: G.M. Decides to Forg... Media Decoder Blog: G.M. Decides to Forgo Super Bowl Advertising
05/18/2012
For the second time in a week, General Motors is making news for advertising it will not be running rather than for advertising it is running. (1 h ago)

• Advertising: TV’s Upfront Week Is Filled... Advertising: TV’s Upfront Week Is Filled With Music, Mash-Ups and Frenzy
05/18/2012
During television upfront week, NBC reached for Broadway’s stars for several new series, James Murdoch appeared at a Fox party, and USA and the CW tapped show fans to work up excitement. (5 h ago)

• Political Memo: Romney Camp Tries to Lim... Political Memo: Romney Camp Tries to Limit Reporters’ Access, and Rope Line Ruckus Erupts
05/18/2012
The Romney campaign on Wednesday may have attempted to keep their candidate away from reporters on the rope line, where he has had a few slip-ups. (9 h ago)

• A Sly Wink to Pinups of the Past A Sly Wink to Pinups of the Past
05/17/2012
The pinup, once fodder for magazines with evocative titles like Eyeful and Wink, has evolved from the all-American calendar girl to an emblem of hip femininity. (1 d ago)

• Advertising: ‘Two and a Half Men’ Aims t... Advertising: ‘Two and a Half Men’ Aims to Lift Thursday
05/17/2012
The shift will be the second time that CBS has moved a successful Monday comedy to Thursday to try to establish a stronger foothold with viewers later in the week. (1 d ago)

• Up Close: Edward Enninful: An Image Make... Up Close: Edward Enninful: An Image Maker Who Gets the Picture
05/17/2012
Edward Enninful likes to go against type when he styles a photo shoot, and it’s working for W Magazine. (1 d ago)

• Dish Network’s Auto Hop Cuts Ads and Cau... Dish Network’s Auto Hop Cuts Ads and Causes Tremors at TV Upfronts
05/17/2012
As with past technological threats, network executives are closing ranks against a Dish Network device that undermines the broadcast business model. (1 d ago)

• No End in Sight to Inquiry Into Murdoch’... No End in Sight to Inquiry Into Murdoch’s Media Empire
05/17/2012
The scandal that has shaken Rupert Murdoch’s global media empire is now the focus of three Scotland Yard inquires and more than 100 civil lawsuits. (1 d ago)

• G.M. to Quit Facebook Ad Campaign Worth ... G.M. to Quit Facebook Ad Campaign Worth $10 Million a Year
05/16/2012
The loss of $10 million in ad dollars does not represent a financial disaster for Facebook, but it is a public relations headache so close to the company’s initial stock offering this week. (2 d ago)

• Advertising: Broadcasters Pitch Programm... Advertising: Broadcasters Pitch Programming for Hispanics - Advertising
05/16/2012
Nine cable channels and broadcast networks are offering advertisers a way to reach the Hispanic population, up from five at the upfronts presentations last year. (2 d ago)

• Rebekah Brooks Charged With Perversion o... Rebekah Brooks Charged With Perversion of Justice Over Hacking
05/16/2012
Rebekah Brooks, the former chief executive of Rupert Murdoch’s newspaper outpost in Britain, and five others were charge with conspiring to pervert the course of justice in the case. (2 d ago)

• Mike McGrady, Known for a Literary Hoax,... Mike McGrady, Known for a Literary Hoax, Dies at 78
05/16/2012
As a Newsday journalist, Mr. McGrady led his colleagues in the creation of “Naked Came the Stranger,” a steamy parody novel. (2 d ago)

• Your Money: Managing Risk in Your Nest E... Your Money: Managing Risk in Your Nest Egg - Your Money
05/19/2012
In light of JPMorgan Chase’s multibillion-dollar loss, a look at how individuals can manage risk in their own investments with trade-offs and moderation. (1 h ago)

• Shortcuts: Avoiding Robocalls, Telemarke... Shortcuts: Avoiding Robocalls, Telemarketers and Other Phone Annoyances
05/19/2012
The Do Not Call registry can cut down on the dreaded calls from telemarketers, but wouldn’t getting rid of the landline altogether be better? (1 h ago)

• Wealth Matters: Franchise Success Means ... Wealth Matters: Franchise Success Means Doing Things the Franchiser’s Way
05/19/2012
Investing in an franchise can seem like a sure bet, but success requires an ability to run a business the franchiser’s way, as well as some luck. (1 h ago)

• The Haggler: Class Actions Face Hurdle i... The Haggler: Class Actions Face Hurdle in 2011 Supreme Court Ruling
05/18/2012
Last year, the Supreme Court said that corporations could write contracts that blocked class-action lawsuits. Now we are seeing that ruling’s effects. (1 h ago)

• Bucks Blog: Managing the Risk in Your In... Bucks Blog: Managing the Risk in Your Investment Portfolio
05/18/2012
JPMorgan's trading debacle offers lessons for small investors about risk management. (1 h ago)

• Bucks Blog: The Caveats of Franchise Inv... Bucks Blog: The Caveats of Franchise Investing
05/18/2012
Bucks readers tell of their experiences in investing in franchises. (2 h ago)

• Mortgages: Mortgages - Shopping for Loan... Mortgages: Mortgages - Shopping for Loans Online
05/18/2012
Experts suggest that would-be borrowers begin the process by reading the fine print of each site they choose to work with. (7 h ago)

• Bucks Blog: Friday Reading: Does Faceboo... Bucks Blog: Friday Reading: Does Facebook Make You a Narcissist?
05/18/2012
Does Facebook make you a narcissist, tracking your smartphone data usage, revived by music and other consumer-focused news from The New York Times. (11 h ago)

• Degrees of Debt: Student Loans Weighing ... Degrees of Debt: Student Loans Weighing Down a Generation With Heavy Debt
05/18/2012
Nearly everyone pursuing a bachelor’s degree is borrowing money, and as prices soar, a college degree often comes with an unprecedented financial burden. (20 h ago)

• Strategies: Investors’ Flights to Safety... Strategies: Investors’ Flights to Safety Can’t Hide the Danger
05/17/2012
Amid more economic upheaval in Europe, investors have again turned to havens like Treasury bonds. But how long can the patterns repeat? (1 d ago)

• Economic View: Slippery-Slope Logic vs. ... Economic View: Slippery-Slope Logic vs. Health Care Law - Economic View
05/17/2012
The court debate over the new health care law offers yet another example of worrying about imaginary risks. (1 d ago)

• Bucks Blog: Problems With Online Bill Pa... Bucks Blog: Problems With Online Bill Paying at Big Banks
05/17/2012
Customers of at least two big banks reported problems with online bill payment services this week. (1 d ago)

• States Diverting Mortgage Settlement Mon... States Diverting Mortgage Settlement Money to Other Uses
05/16/2012
Some states are diverting their share of $2.5 billion they were awarded in a mortgage settlement, money intended to help homeowners and mitigate the effects of foreclosures. (2 d ago)

Business

Technology

Sports

Entertainment

Шкафы купе на заказ в Москве Уваж...
qstholgndv :: 02/09/2012

hi!!!
Snums :: 01/31/2012

Check Online Pharmacies offering Tramadol online w...
Idioteone :: 12/13/2011

forsted sex asian whore porn tripple penetration s...
Lola_naf :: 12/13/2011

They are huggable and throw able. Add voice overs ...
MaryTenderLOS :: 11/29/2011

решил вам немного помочь и послал этот пост в соци...
Выкуп автомобилей с пробегом :: 11/23/2011

privv boo kok 445
Loyallels :: 11/21/2011

спасибо, в закладки
Гипсокартон Лафарж :: 11/16/2011

Nice post :) Foken refs
NarovarlyJala :: 11/14/2011

iuurr 588 kkk
nolaerawHoord :: 11/12/2011

• Banks spend big to prop up Facebook shar... Banks spend big to prop up Facebook shares on first day of trading
05/19/2012
It was another Wall Street bailout — but this time the banks had to cough up the cash. Facebook’s underwriters propped up the social-network’s trading debut yesterday, as the shares threatened to crash through the initial public offering price of $38. The banks working on the massive $16 billion... (1 h ago)

• MF $$ without a trace MF $$ without a trace
05/19/2012
MF Global Holdings still can’t trace where some of the money went when its brokerage collapsed, including $1 billion that “vanished” into the brokerage unit MF Global Inc., an attorney told a bankruptcy court. Brett Miller, a lawyer for MF Global Holdings’ Chapter 11 estate, told US Bankruptcy Judge... (1 h ago)

• Zuckerberg irked at both NYSE, Nasdaq Zuckerberg irked at both NYSE, Nasdaq
05/19/2012
There’s only one other firm that had a more lackluster day on Wall Street than Facebook yesterday: Nasdaq. The exchange run by CEO Bob Greifeld drew the ire of bankers and investors alike as market players expressed disappointment with the glitch-ridden opening of Facebook’s uber-hyped initial public offering... (1 h ago)

• Paulson pals head for exit Paulson pals head for exit
05/19/2012
John Paulson’s stubborn bullishness cost the hedge fund superstar billions of dollars last year. Now one of the partners overseeing the bank stocks that dragged the firm down is starting a hedge fund of his own. Robert Lacoursiere, a former partner and head of global banks at Paulson, is... (1 h ago)

• Geithner a regulate guy Geithner a regulate guy
05/19/2012
Treasury Secretary Timothy Geithner has called assertions he is resistant to tough new financial rules “ridiculous.” The former president of the Federal Reserve Bank of New York said there is no evidence he has tried to water down new regulations being written as part of the Dodd-Frank overhaul of the... (1 h ago)

• Sour note for Dolan Sour note for Dolan
05/19/2012
For Cablevision boss Jim Dolan, life isn’t all hockey pucks and basketballs. As if the agita caused by the performance of the Dolan-owned New York Rangers and Knicks weren’t enough for the executive, Wall Street has been thrashing Cablevision shares lately — driving the price down 25 percent this... (1 h ago)

• Business briefs Business briefs
05/19/2012
RundownFormer Red Sox hurler Curt Schilling must seek private financing to keep his video game company 38 Studios afloat. The studio earlier this month failed to make a $1.125 million payment to Rhode Island on a $75 million loan. The payment was ultimately made, but RI Gov. Lincoln Chafee... (1 h ago)

• GM no longer feeling Super GM no longer feeling Super
05/19/2012
General Motors stunned Madison Avenue for the second time in a week, saying yesterday it will not advertise during the telecast of the 2013 Super Bowl. Earlier this week, the car maker said it would discontinue its $10 million ad buy on Facebook. The company, which went bankrupt and then... (1 h ago)

• Yahoo! in $7B Alibaba talks Yahoo! in $7B Alibaba talks
05/19/2012
Yahoo! is in talks to sell about 20 percent of Alibaba Group Holding. For about $7 billion, a deal that would cut by half its stake in China’s largest e-commerce provider, according to a person with knowledge of the matter. Alibaba, which has been trying to buy back the... (1 h ago)

• Wal-Mart profit jumps, boosted by US sal... Wal-Mart profit jumps, boosted by US sales
05/17/2012
Wal-Mart posted a better-than-expected quarterly profit on Thursday, including a 2.6 percent rise in sales at its Walmart U.S. division's stores open at least a year. (1 d ago)

• Penney suffers biggest one-day drop sinc... Penney suffers biggest one-day drop since ‘87
05/16/2012
Shares of retailer J.C. Penney (JCP) fell 20 percent to $27 Wednesday, one day after the department store owner scrapped its dividend. (2 d ago)

• These budget coffee makers will perk you... These budget coffee makers will perk you up
05/16/2012
Single-cup pod brewers are seducing a growing number of coffee drinkers with their convenience: Simply choose a coffee pod, pop it in, and press a button. (2 d ago)

• Skechers to pay $40 million over decepti... Skechers to pay $40 million over deceptive ads
05/16/2012
Skechers, the company that makes those popular Shape-ups toning shoes, has agreed to pay $40 million in refunds to settle charges of deceptive advertising brought by the Federal Trade Commission. (2 d ago)

• What you don't know about credit scores ... What you don't know about credit scores could hurt you
05/16/2012
Your credit score, which is based on your credit history, can have an enormous effect – positive or negative – on your life. That score is used by employers, lenders, landlords and insurance companies. (2 d ago)

• You’re the Boss Blog: Introducing Deirdr... You’re the Boss Blog: Introducing Deirdre Lord, a New Business Group Member
05/18/2012
Deirdre Lord and a longtime colleague teamed up to start The Megawatt Hour. "Essentially, we're the Turbo Tax for businesses that buy energy in deregulated markets," she said. (12 h ago)

• Small-Business Guide: Small-Business Own... Small-Business Guide: Small-Business Owners Face a Transition After the Sale
05/17/2012
The negotiation phase is critical when transitioning from entrepreneur to employee of a parent company. (1 d ago)

• You’re the Boss Blog: Why I Cut My Own S... You’re the Boss Blog: Why I Cut My Own Salary
05/17/2012
Our cash is holding steady, but I don't have a good feeling about the immediate future. We're just not seeing as many eager buyers. (1 d ago)

• The Agenda: Obama Proposes New Tax Credi... The Agenda: Obama Proposes New Tax Credit for Small Businesses That Hire
05/16/2012
A company that increased its payroll by $4 million would be allowed a $400,000 income tax credit. (2 d ago)

• You’re the Boss Blog: Could You Handle B... You’re the Boss Blog: Could You Handle Being an Employee?
05/16/2012
When a business is sold, some owners make the difficult transition from entrepreneur to employee. Owners who have had the experience say it is important to negotiate well - and be prepared for the worst. (2 d ago)

• Sponsored By: Sponsored By:
05/16/2012
(2 d ago)

• Long-term jobless need to be proactive Long-term jobless need to be proactive
05/16/2012
Long-term joblessness can be one of the worst things a person has to go through, but job seekers have to brush aside the pessimism and take action. (2 d ago)

• The little things: Managing a micromanag... The little things: Managing a micromanager
05/16/2012
Often a micromanager’s need for control stems from insecurity: lack of confidence, workplace instability and pressure to produce – both individually and as a team. (2 d ago)

• Day care cost hikes derail women's caree... Day care cost hikes derail women's careers
05/16/2012
Clarissa Doutherd, 30, was able to lift herself out of poverty and climb the ladder of success at a nonprofit. But last year the high cost of child care stalled her ambitions. (2 d ago)

• European leaders add to rising fears of ... European leaders add to rising fears of breakup
05/17/2012
European officials are playing a dangerous game of chicken with Greece. (1 d ago)

• Rising wealth in China fails to buy more... Rising wealth in China fails to buy more happiness
05/17/2012
Sometimes more money just buys more unhappiness. Take China, for example. Everyone assumed that people would get happier as their wallets got fatter. But a new study shows that the opposite occurred, at least for those at the lower end of the income spectrum. (1 d ago)

• World Bank on Greece: Spain, Italy could... World Bank on Greece: Spain, Italy could be next
05/17/2012
Spain and Italy will be the next victims of the European financial crisis if Greece crashes out of the euro currency zone, the head of the World Bank has warned. (1 d ago)

• The world braces for messy impact from G... The world braces for messy impact from Greece
05/16/2012
As Greece teeters on the edge of financial collapse, European officials have a new task before them: preventing the financial turmoil from spreading around the rest of the world. (2 d ago)

• Measuring marketing’s worth Measuring marketing’s worth
05/18/2012
You can’t spend wisely unless you understand marketing’s full impact. Here are five questions executives should ask to help maximize the bang for their bucks. Read more on the McKinsey Quarterly > Topics: Marketing (8 h ago)

• Why bad multiples happen to good compani... Why bad multiples happen to good companies
05/16/2012
A premium multiple is hard to come by and harder to keep. Executives should worry more about improving performance. Read more on the McKinsey Quarterly > Topics: Corporate Finance (2 d ago)

<	May 2012					>
S	M	T	W	T	F	S
		1	2	3	4	5
6	7	8	9	10	11	12
13	14	15	16	17	18	19
20	21	22	23	24	25	26
27	28	29	30	31