NEWS,04.11.2012

Obama and Romney sprint to unpredictable finish

President Barack Obama and Republican challenger Mitt Romney are sprinting to an unpredictable finish in the last 48 hours of a very close race for the White House.The two candidates have been trying to turn out supporters and woo undecided voters in a handful of toss-up states.Obama and Romney began cross-country trips on the next-to-last day of a race that polls show is deadlocked nationally, although the president appeared to have a slight edge in the swing states that will decide who captures the 270 electoral votes needed to win on Tuesday .US correspondent told Breakfast the race was "insanely tight", with polls showing the two candidates within a margin of error of each other."Both candidates are trying to win over any last-minute voters that they can especially in the swing states that will likely win this election," he said."Perhaps the state of most importance of crucial importance to both campaigns - is Ohio. Barack Obama is campaigning there every day at the moment," he said.Political Editor Corin Dann told the programme that support in Obama's hometown was muted and there was some disappointment after his first term.He said Chicago was "very much a Democrat town" but that Romney supporters were also visible.Obama himself did not have any events scheduled in Chicago over the next couple of days, Dann said. "All the effort and energy is spread out into those states which will decide this election."But our correspondent said that despite the popular vote being close, he believed Obama had "a pretty clear lead when it comes down to the Electoral College vote", which will actually decide the election.After months of sometimes bitter attacks and saturation advertising in pivotal states, Obama and Romney pressed their arguments that they offer the best solution to weak economic growth and partisan gridlock in Washington.The two also made direct appeals for votes in a race that may come down to which side does the best job of getting its supporters to the polls."It's up to you. You have the power," Obama told a crowd of more than 14,000 people who filled the downtown streets of Concord, New Hampshire."You will be shaping the decisions for this country for decades to come, right now, in the next two days."In Iowa, Romney urged more than 4,000 people in a Des Moines hall to get out and vote and convince a few undecided or former Obama supporters to back him while they are at it.Romney, the former governor of Massachusetts, renewed his argument that he is the candidatewho offers real change and can reach out to Democrats to craft bipartisan agreements."Accomplishing real change is not just something that I talk about. It's something that I've done," Romney told supporters in Des Moines."And it's something I'm going to do when I am president of the United States."Advisers for Obama and Romney blanketed the Sunday morning news shows to predict victory in a race focused on eight or nine battleground states that will provide the margin of victory in what national polls show is likely to be a very tight race.A daily online tracking poll on Sunday showed Obama with a national lead over Romney of 48% to 47% - essentially a dead heat.The result fell within the survey's credibility interval, a tool used to account for statistical variation in Internet-based polls.Many polls show Obama with a slight but persistent lead in Ohio, Wisconsin, Iowa and Nevada states that would give him more than the 270 electoral votes he needs, barring any surprises elsewhere.Republicans said they see a different story in early voting in key states, which mostly shows Democrats casting more early ballots but not at the pace that Obama set in his victory in 2008 over Republican John McCain by 7 percentage points.Obama and Romney planned stops on Sunday in Ohio, perhaps the most critical of the swing states and particularly vital for Romney. If he loses Ohio, Romney would need a breakthrough in another state where polls currently show him trailing.Both candidates were getting plenty of help in the late stages from their running mates, Vice President Joe Biden and Wisconsin congressman Paul Ryan.Obama also got help at his New Hampshire rally from popular former President Bill Clinton.Ryan joined fans holding tailgate parties outside a Green Bay Packers football game in Wisconsin.Campaigning in Ohio, Biden joked that the end of Daylight Savings Time in the United States on Sunday was Romney's favorite day because he could officially turn back the clock.

World week ahead: All eyes on US election

All eyes are on the US presidential elections this week and investors may prove hesitant to make fresh bets until the results are in.One of the latest polls showed that President Barack Obama is slightly ahead of Mitt Romney in Ohio and Florida, viewed by many strategists as the two most important swing states. The Wall Street Journal/Marist College survey of likely voters put Obama ahead of Romney in Ohio, 51% to 45%, and in Florida, 49% to 47%, according to Bloomberg News. Obama appears to be receiving a lift from his managing of the crisis in the wake of Hurricane Sandy as well as encouraging economic signs."The market might like the fact of an Obama win since it would mean less uncertainty," Ryan Detrick, senior technical strategist at Schaeffer's Investment Research, in Cincinnati, told Reuters.Trading on Wall Street was limited to three days last week-stock markets were closed on Monday and Tuesday-as Hurricane Sandy caused an estimated US$50 billion of damage to the East Coast of the US.New York City in particular was hit hard with transportation and the power grid suffering significant damage. In addition, almost half of the people killed as a result of the superstorm died in the New York City area.Amid low volume and a focus on the storm, markets were mostly muted the final three days of last week: the Standard & Poor's 500 Index gained 0.2%; the Dow Jones Industrial Average fell 0.1%; and the Nasdaq Composite Index shed 0.2%.There were notable and individual exceptions among companies including Starbucks which lifted its profit forecast for the fiscal year and whose shares surged 9% on Friday.The latest clues on the state of the world's largest economy will come in the form of the ISM Non-Manufacturing Index and reports on international trade and weekly jobless claims in the days ahead.Last week, data provided much-needed relief with better-than-expected numbers on consumer confidence and manufacturing. Most importantly October's jobs report-released on Friday-was stronger than anticipated and bolstered hope that progress is being made after all in the struggling labour market. US employers added 171,000 jobs in October and more people resumed looking for work, which pushed the jobless rate slightly higher to 7.9%.The US Treasury is scheduled to sell US$72 billion in notes and bonds this week, according to Bloomberg. The appetite for US government debt remains strong as the economic impact of Sandy raised fresh concerns about the recovery. A Reuters poll of economists predicted that Sandy will knock 0.2 percentage points off of fourth-quarter gross domestic product. US bonds also are being lifted by the lingering EU crisis. Europe's feeble finances may take five years or more to resolve, German Chancellor Angela Merkel told some of her own party officials on Saturday.Looking beyond the elections, the outlook for US corporate earnings continues to weigh on Wall Street. Of the 378 companies in the S&P 500 that have reported earnings so far, 61.9% have exceeded forecasts, in line with the 62% quarterly average since 1994, according to Thomson Reuters data through Friday.However, just 38.2% of companies having reported better-than-expected revenue, compared with the 62% quarterly average since 2002 and the 55% average over the past four quarters.Companies set to report this week include Groupon, Time Warner Cable and News Corp.In Europe, the Stoxx 600 Index increased 1.6% last week lifted by some strong results from a range of companies including Deutsche Bank as well as a plan by UBS to slash 10,000 jobs as it refocuses its business.Not to be forgotten, policy makers at the European Central Bank and the Bank of England meet later this week. BOE officials will decide whether to extend the bank's asset-purchase program after the UK economy grew in the third quarter. The nine-member Monetary Policy Committee will probably leave the target for asset purchases at 375 billion pounds (nz$728 billion), according to 35 of 45 economists in a Bloomberg News survey. Seven forecast a 50 billion-pound increase in quantitative easing, and three expect a 25 billion-pound expansion.The latest data on China-with reports on retail sales, industrial production, and the consumer price index due this week-will also be closely watched for further clues that the slowdown in the pace of expansion of the world's second-largest economy is less than initially feared. A report on the weekend showed that China's non-manufacturing sector rebounded in October. The timing is good as it comes days ahead of the once-in-a-decade leadership change at the top of the Communist Party set for November 8.

Greek PM warns of euro exit

Greek Prime Minister Antonis Samaras warned again on Sunday that the debt-crippled country could be forced out of the euro if parliament fails to approve a new round of austerity measures needed for a lifeline from creditors."We must save the country from catastrophe... if we fail to stay in the euro nothing will make sense," he told lawmakers from his conservative party.Parliament is due to vote Wednesday on a bill outlining €18bn of cuts and other reforms, followed by a vote on Sunday on the 2013 budget as Greece battles to secure a new tranche of aid from its troika of international creditors.Samaras said the votes were vital to "put an end once and for all" to the risk that Greece, faced with a crushing debt mountain, could return to the drachma.He called on coalition partners, the socialist Pasok and the moderate left-wing Dimar (Democratic Left) parties, which have raised concerns about the scope of the measures, to act in the "supreme interests of the nation".Greek unions however are planning a two-day strike from Tuesday to coincide with the austerity vote amid seething public anger over further painful cuts in a country that is heading for its sixth year of recession.Greece has been negotiating with the European Union, International Monetary Fund and the European Central Bank to unlock a €31.5bn tranche of a bailout package or risk bankruptcy in mid-November.But the IMF said last week that the talks were stalled over the conditions for financing Greece, which has been seeking a two-year extension to meet its fiscal goals, sending stocks crashing.The Dimar party, which has 16 deputies, has suggested it would vote against the bill Wednesday because of its objections to labour market deregulation proposals, while up to five socialist lawmakers could also defy Samaras.The dissenters would leave the government with a narrow majority, with just 154-159 seats in the 300-member assembly, the Greek press said on Sunday, while predicting the measures would nevertheless go through.

 

G20 flags US fiscal cliff

Finance chiefs of the world's 20 leading economies are ringing alarm bells over the US fiscal cliff and Europe's debt woes at a meeting in Mexico this weekend as they look to push back deficit reduction targets to help boost growth.Unless a fractious US Congress can reach a deal, about $600bn in government spending cuts and higher taxes are set to kick in on January 1, threatening to push the American economy back into recession and hit world growth.But with the US presidential election looming on Tuesday, dealing with the fiscal cliff has been delayed. "The Americans themselves acknowledge that this is a problem," a G20 official said on condition of anonymity. "The US administration says it doesn't want to fall off the fiscal cliff, but right now it can't tell us how exactly it will address it because that issue is on ice ahead of the election."Tax cuts enacted under President George W. Bush are set to expire in January, when automatic spending cuts designed to put pressure on lawmakers to strike a long-term budget deal are also set to kick in."What remains a sort of key aspect is that the United States is not respecting the current commitments (to reduce its deficits) and does not have a credible fiscal consolidation plan," one European official said. The US Congress will also soon have to raise the nation's debt limit to avoid a default. An initial consensus around the need for urgent action to prevent a new depression has given way to deep differences over issues such as spending to boost growth and the right pace of belt-tightening to tackle high debt levels. Jose Angel Gurria, head of the Organisation for Economic Co-operation and Development, said on Saturday the G20 should appeal to the United States to avoid the fiscal cliff, but added he was optimistic that Congress would strike a deal."I still believe it is not going to be applied," Gurria said in an interview before the meeting of G20 finance chiefs, which formally starts on Sunday. Officials are also concerned about Japan's own fiscal cliff, and recognise that previous commitments made by developed countries to cut their budget deficits in half by 2013 and to stabilise their debt load by 2015 look unfeasible.US and European officials are also likely to come under pressure from G20 peers for dragging their feet on implementing the so-called Basel III accords on financial regulations, the world's response to the 2007-09 financial crisis. Despite the issue's prominence, a G20 source said Russia wants to keep financial regulation discussions at a more technical level when it takes over the presidency of the group from Mexico after this meeting, which ends on Monday. Spain's reluctance to seek financial aid is stoking worries that Europe's debt crisis could further hurt world growth. The government is under pressure to seek a bailout as it struggles to cope with high public debt and the cost of recapitalising its banks. Eurozone sources say they expect Spain to seek financial aid from the eurozone in November. A government source told Reuters on Wednesday that Prime Minister Mariano Rajoy had not ruled out applying for a rescue, but Rajoy has signaled he will not rush unless market conditions deteriorate significantly.

G20 finance chiefs to tackle euro crisis

G20 finance chiefs begin Sunday two days of talks aimed at quelling fears of a global economic downturn amid a persistent eurozone debt crisis and a looming fiscal crunch in the United States.Finance ministers and central bank governors from the Group of 20 top economies will gather in Mexico City as debt-riddled Greece continues to trouble Europe while Spain fights off pressure to seek a bailout.While Madrid avoids the bailout route, the problems in Greece are still haunting Europe's single currency, more than two years after Athens received its first multi-billion-euro rescue.Greek officials are locked in tough negotiations with European Union and IMF auditors over austerity measures Greece must take in return for a bailout payment it needs to avoid defaulting on its debt.While the fiscal situation in the United States is also a major concern, officials do not expect any movement on that front until after Tuesday's US presidential election.The White House and Congress need to find a compromise by the end of the year to avoid a "fiscal cliff" of automatic spending cuts and tax hikes, which experts say could hurt the US economy and curb global growth.The meeting is a follow-up to a June summit, when G20 leaders vowed to coordinate "fiscal actions" to boost domestic demand if economic conditions deteriorated.Since then, the IMF slashed its 2012 global growth forecast to 3.3%, eurozone unemployment rose to a record 11.6% in September and growth decelerated in emerging nations.