Job losses deepen Monday blues

Companies all over the world announced thousands of job losses today as a survey among US private sector companies suggests that the situation will only get worse.

Caterpillar, producer of heavy machinery such as bulldozers, announced that 20,000 of its employees will face the sack is it made more than a third less profit for the last three months of 2008.

Six thousand employees will be fired from electronics producer Philips.

In the UK steel maker Corus announced 2,500 job cuts while France is considering a stimulus plan to help airlines purchase planes that will in turn save Airbus.

All these job cuts are affecting both skilled and unskilled workers. This means that there are more unemployed individuals with tertiary education than before. Writing on the Wall Street Journal, Dawn Jordan, former vice president of operations at Bank of America writes:

I know my education will be key in landing my next job, but it didn’t prevent me from losing my last one. And it doesn’t carry any guarantees about the job after that. Given the growing number of intelligent, experienced workers being laid off everyday, I can’t help but wonder, what besides education and experience is needed to increase job security in today’s workplace?

Meanwhile UK Prime Minister Gordon Brown called for a new world order after the crisis. This is already happening with Kuwaiti firm Noor Financial Investments forming ventures with Russian gas giant Gazprom

Bank posts biggest loss in British history

CNBC just announced that Royal Bank of Scotland, one of the major banks in Britain, has posted a $30 billion loss for 2008.

This is the biggest loss in Britian’s corporate history.

“If the banking system collapses, every single one of us would see the obvious problems. The economy would come down with it,”  said Alistair Darling, Britian’s Chancellor of the Exchequer.

This news comes as the UK government prepares to take over as much as 70% of the bank in a bid to rescue it. This is part of a £300bn rescue package that was announced this morning.

Some sectors of the press are however already doubtful whether this second bank bailout will be successful.

Professor Peter Spencer from York University however argues, “We must not lose sight of the fact that they [bank bailouts] have prevented the collapse of the monetary system.” Were this to happen, this would spell disaster for the whole global economy.

Ambrose Evans-Pritchard however states that “this does not mean that recovery is imminent’.

I do not envy anyone who has to deal with this financial mess.

When will situation improve? It may take 2 – 3 years – argues steel giant

Steel giant Nippon Steel today argued that the global steel industry may well take two to three years to recover from the current economic downturn, Reuters reports.

The company’s announcement comes as one of its top clients, Toyota, is seeking to reduce its orders for steel.

So, with the car industry and steel industry feeling the brunt of the global economic downturn, which sectors should an investor eye?

The Baring Global Agriculture Fund and fund manager Managing Partners’ British Property Opportunities Fund are two options, argues William Kay in an article appearing on today’s The Sunday Times.

He also reminds readers to start thinkng aobut their retirement plans early as research shows that one in every four of today’s 55-year-olds in the UK is expected to live till 95.

Britain’s economic fall is deepest since 1931 – experts argue

Britain may be experiencing the worst economic decline in peaceful times since 1931, argues a report to be released by Ernst & Young Item club next week which was seen by The Times today.

Unemployment in Britian is expected to hit the 3.25m mark, the same report says.

Meanwhile, the British government prepares to bail out its banks with a further £100 billion, The Times says. 

The past hour in news was not, however, all doom and gloom.

Barclays is in fact set to report a £6 billion pre-tax profit next month, The Telegraph says. The bank had announced 2,100 layoffs earlier this week.

Brits are negative; Italians still upbeat

 

As sad as Onslow

When it comes to the economy, everyone’s become a bit like Onslow – negative.

Brits simply can’t trust Banks, the stockmarket and the government’s handling of the economy, The Guardian reports today as it refers to a global poll which tries to guage the different levels of trust towards these institutions in different countries. 

While Brits emerge as mostly pessimistic on most measures interviewed upon, the Italians are more optimistic.

Hoewever, Indians are the most optimistic of the lot, the survey shows.