NEWS,18.01.2013

US consumer sentiment hits record low

US consumer sentiment unexpectedly deteriorated for a second straight month to its lowest in over a year in January, with many consumers citing the recent fiscal cliff debate in Washington, a survey released on Friday showed.The sharp drop in sentiment over the last two months coincides with rancorous federal budget negotiations that have led to higher taxes for many Americans.Just weeks after that deal, President Barack Obama and Republican lawmakers are expected to enter another tough round of negotiations over spending cuts, which could dent consumer confidence still further."The handling of the fiscal cliff talks and the realization that paychecks are going to be smaller due to the sunset of the payroll tax holiday are probably weighing on consumer attitudes at the moment," said Thomas Simons, a money  market economist at Jefferies & Co. in New York. "With the debt ceiling yet to be tackled and more political acrimony on the way, we suspect that confidence has room to deteriorate further."The Thomson Reuters/University of Michigan's preliminary reading on the overall index of consumer sentiment came in at 71.3, down from 72.9 the month before. The index was at its lowest since December 2011. It was also below the median forecast of 75 among economists polled by Reuters."The most unique aspect of the early January data was that an all-time record number of consumers - 35% - negatively referred to the fiscal cliff negotiations," survey director Richard Curtin said in a statement. "Importantly, the debt ceiling debate is still upcoming and could further weaken confidence," he said.House Republicans signaled on Thursday they might support a short-term extension of U.S. borrowing authority when the government exhausts that capacity sometime between mid-February and early March. A failure by Congress to raise this debt ceiling could result in a market-rattling government default. US stocks remained little changed after the data. The S&P 500 hit a five-year high in the last session. But on Friday, a weak outlook from Intel offset encouraging data out of China and a fourth-quarter profit at Morgan Stanley So far there has been a disconnect between what consumers say and do. US retail sales increased a better-than-expected 0.5% in December. But given the recent weakening in sentiment investors will be watching for any signs that spending is starting to slip."The impact on consumers will be from the hike in the social security tax. That is undoubtedly going to hit discretionary spending. So this may be a signal of things to come," said Michael Woolfolk, a senior currency strategist at BNY Mellon in New York.The consumer survey's barometer of current economic conditions fell to 84.8 from 87.0 and was below a forecast of 88.0. The gauge hit its lowest since July.The survey's gauge of consumer expectations also slipped, hitting its lowest since November 2011 at 62.7 from 63.8, and was below an expected 65.2.The survey's one-year inflation expectations rose to 3.4% from 3.2%, while the survey's five-to-10-year inflation outlook was at unchanged at 2.9%.

China's growth slows in 2012

China's economy grew at its slowest pace in 13 years in 2012, though a year-end spurt supported by infrastructure spending and a jump in trade signalled the foundation for the stable growth path Beijing says is vital for economic reform may be in sight.Evidence of a burgeoning recovery in exports, stronger than expected industrial output and retail sales, together with robust fixed asset investment, all indicated that Beijing's pro-growth policy mix has gained sufficient traction to underpin a revival without yet igniting inflationary risks.Year-on-year growth of 7.9% in the fourth quarter beat a consensus forecast of 7.8% in a Reuters poll and snapped a streak of seven consecutive quarters of slowdown.The performance was at the upper end of the 7%-8% rate economists reckon is needed to deliver on reforms essential to China's long-term development after three decades of red-hot, double-digit growth.Full year growth of 7.8% was also just ahead of the poll's 7.7% call and, although the weakest since 1999, comfortably ahead of the government's 7.5% target, which just months ago seemed to some economists to be in jeopardy."It's kind of like a golden spot - stronger growth, but not strong enough to trigger a lot more inflationary concern. That's perfect for equity markets." said Dariusz Kowalczyk, Asia ex-Japan senior economist and strategist at Credit Agricole CIB in Hong Kong."What everybody wants is growth that's strong enough to give us peace of mind that revenues will increase and there is no hard landing risk, but not excessive, not strong enough to trigger inflation. And this is what I think we are getting. I'm bullish on China still."Market reaction was generally upbeat, with Asian shares advancing and platinum and palladium following suit, while oil traders took the opportunity of data confirming the recovery to book profits after two sessions of steep rises.China's new leaders must stabilise the economy this year to keep employment high while avoiding a surge in housing prices and inflation that could undermine reforms needed to overhaul the country's export-oriented growth model.Without stability, incoming President Xi Jinping and Premier Li Keqiang, who are set to be confirmed in March, have no chance of delivering a slew of reforms they say are needed to tackle a host of financial, industrial and income imbalances that threaten China's future.China's statistics chief, admitting the country's wealth gap was "relatively large", released a recalculated indicator of economic inequality on Friday, the first time in several years that officialdom has addressed the sensitive issue head-on. China's Gini coefficient stood at 0.474 in 2012, down from 0.477 in 2011 and from a peak of 0.491 in 2008, Ma Jiantang, the head of the National Bureau of Statistics, told reporters at a press conference on 2012 economic performance. The index ranges from 0 to 1, with the 0.4 mark viewed by analysts as the point at which social dissatisfaction may come to a head. China's leaders say rebalancing the economy to consumption and away from the investment and export model followed for the last 30 years holds the key to tackling inequality, but detailed data on Friday underlined the scale of that task. While consumption made the biggest contribution to growth in 2012, with a 51.8% share, Q4 marked the third consecutive quarter of decline. The fall has been driven by the government's focus on using investment spending as the main expedient to underpin an economy still levered to external demand. Exports generate about a third of economic activity and sinking demand from foreign customers in struggling European Union and United States economies dragged on growth in 2012. Net exports made a negative 2.2% contribution, data showed. ith China's consumers still relatively poor - average annual urban disposable income was just 21,810 yuan ($3 500) in 2011 - it remains too hard for the government to rely on them to help compensate for any shortfall from the export sector. "There's just not enough money," said Liu Jiongda, 35, a manager at a Shanghai logistics company who earns just over 11,000 yuan ($1 500) per month, more than half of which goes straight into a mortgage on a property he bought in 2009. "If the government wants a so-called consumer culture, they have to cut the amount of tax I have to pay. That is simple. If I have more money then I'll be willing to spend more." Investment meanwhile, at 50.4%, has picked up as the new leadership has looked to underpin a recovery with spending on infrastructure a tried and tested method. Quarter-on-quarter growth of 2.0% was below the market's expectation of a 2.3% rise, which was taken as a sign that the recovery's momentum is not strong enough to worry the authorities into pre-emptive action to snuff out any whiff of inflation - China's long term policy pre-occupation. The People's Bank of China, which cut interest rates twice in mid-2012 and cut banks' reserve ratios (RRR) three times since late 2011, has since switched to short-term cash injections via open market operations to guide monetary policy, apparently wary of fanning price pressures or encouraging a property bubble."We need to keep vigilant against inflation," NBS chief Ma Jiantang told a news conference on Friday. The risk of policy tightening looms as growth gathers pace, leaving Beijing with a fine line to tread to ensure the recovery continues without reigniting speculative activity in the key area of real estate. Data released alongside GDP numbers on Friday showed home prices extending a slow rise in December, with an average rise of 0.3% month-on-month in 70 major Chinese cities, the fifth month in the last six to show an increase, despite government efforts to temper prices. Real estate investment, which accounted for 13.8% of China's gross domestic product in 2012, rose 16.2% last year from a year earlier and remains a key component of overall fixed asset investment - the cornerstone of Beijing's recovery strategy. Annual fixed asset investment (FAI) growth was 20.6% in 2012, versus the 20.7% forecast in the Reuters poll. "Typically FAI falls off at the end of the year - on average December FAI is 1 percentage point lower than November, but this time there was only a 0.1% edge off," said Ken Peng, an economist at BNP Paribas in Beijing, highlighting the strength of investment spending and the risk that it could be fuelling renewed speculation. Investment spending was the key near-term concern of Ren Xianfang, senior analyst at IHS Global Insight in Beijing. "We have to watch the investment numbers especially because China has started (to put) controls on local financing, so this could limit fund raising and investment by local governments," she said. "So far it's just talk, but if they implement measures like the sharp tightening in 2011 the impact on growth could be very substantial," Ren added, highlighting Beijing's policy dilemma. Other data released alongside GDP showed industrial output grew 10.3% in December from a year ago, versus expectations of 10.1%.Retail sales in December rose 15.2% on a year ago versus an estimated 14.9% in a Reuters poll.A fourth-quarter recovery had been heralded by an acceleration in industrial output in October and November and a jump in exports in December, although some analysts believe last month's sharp expansion in trade could be a blip.China's exports grew 14.1% last month compared with a year earlier, racing past market expectations of 4% and November's 2.9% pace. Ting Lu, chief China economist at Bank of America/Merrill Lynch in Hong Kong, was confident that the data would not change the near term policy stance. "Maintaining stable growth is the new leadership's key policy mandate in 2013," Lu wrote in a note to clients, adding that he expected a growth target of 7.5% to be adopted for 2013 and policy calibrated to delivering it."Pro-growth policies in 2012 will be extended into 2013, and big-bang stimulus will be avoided unless there is another global financial crisis. Within 2013, policy will likely be marginally tightened towards the second half of 2013 on concerns of rising inflation, rising home prices, investment overheating and financial system risks," Lu said.

Obama sends message with new cabinet

A dearth of diversity in Barack Obama's top picks for his new cabinet is overshadowing signs of intent the US president is sending with his freshened team ahead of his second term.Obama takes the oath of office on Sunday ahead of four more years in the White House, a watershed moment that will see familiar faces, led by Hillary Clinton, depart and new blood ushered in to implement the president's political agenda.His personnel decisions, both at the cabinet level and in a rejigging of his White House inner circle, presage a fierce defence of Obama's political legacy at home and abroad in his second term.While posts in a president's cabinet are highly sought after, the centralisation of power in the White House often leaves the secretaries of top government departments chafing at a lack of clout.But several of Obama's top cabinet picks - like Chuck Hagel, John Kerry and Jack Lew, his nominees to run the departments of Defence, State and Treasury - clearly reflect the president's worldview and may wield significant influence.Some cabinet members who are staying on, like Health and Human Services Secretary Kathleen Sebelius - in charge of implementing Obama's top domestic achievement health care reform - will also play key roles.Senator Kerry and ex-senator Hagel, Vietnam veterans both, are sceptical of US military adventures abroad, and backed a fundamental project of Obama's presidency - getting troops home from Iraq and Afghanistan.They are also wary of embroiling the United States in another war over Iran's nuclear programme, though they will publicly back Obama's position that he is ready to use force as a last resort should diplomacy fail.Sebelius will be entrusted with ensuring that ObamaCare, which has yet to be fully implemented, is irrevocably embedded in the fabric of US life by the time the president hands over the keys to the White House in January 2017.Media buzz surrounding Obama's second cabinet has focused mainly on the fact that the first African American president, who won power thanks to a diverse racial and gender coalition, picked middle aged white men for top cabinet jobs.In fact, but for winning a majority of votes among women back in November, Obama might not be living in the White House at all.Aides dismiss the idea that Obama has fallen short of diversity goals, pointing out that his two Supreme Court picks have been women, one a Hispanic, and that he has many females in positions of power around him.Perhaps Obama's closest adviser is Valerie Jarrett, a mentor who followed his family from Chicago to the White House, and he was brought up by strong female role models in his mother and grandmother in the absence of his father.Eric Holder, the African American attorney general, is also staying on.Obama had been expected to name UN Ambassador Susan Rice, an African American, as secretary of state, but her chances of Senate confirmation evaporated amid Republican outrage over the aftermath of the raid on the US mission in Benghazi, Libya on 11 September."I think his record demonstrates the value he places on diversity," White House spokesperson Jay Carney said, adding that more diverse appointments could be expected with remaining open cabinet posts.Obama also addressed the issue during a press conference last week."I think until you've seen what my overall team looks like, it's premature to assume that somehow we're going backward. We're not going backward, we're going forward." Thomas Mann, a political scholar at the Brookings Institution in Washington said that once Obama's full cabinet is announced  with expected or announced openings in big departments like Interior, Energy and the Environmental Protection Agency - the picture could be more diverse.But Obama's new cabinet will differ from his first term, in dispensing with the "Team of Rivals" approach that included his former Democratic primary foe Clinton and Republican secretary of defence Robert Gates, who had served under George W Bush's administration.The selection of Clinton, which surprised senior aides, turned out to be a masterstroke, as the former first lady proved to be a political asset at the State Department, and Obama in effect removed a potential critic from the fray.Few insiders expect Kerry and Hagel, substantial figures in their own right, to be shrinking violets, but they are expected to keep any policy differences inside the Obama administration tent.Some Obama critics question whether the president, who tends to stick to aides who have been with him for years for his White House kitchen cabinet, will get enough outside advice.In one promotion from inside, Deputy National Security Adviser Denis McDonough is expected to succeed Lew for the crucial post of chief of staff.

Tight security plans for Obama swearing-in

Crowds may be smaller on Monday than when Barack Obama was first sworn into office in 2009, but security is as tight as ever, with experts warning a "lone wolf" would pose the greatest threat.Between 500 000 and 800 000 people are expected to pass through the National Mall, the immense greenway that leads up to the Capitol, compared to the 1.8 million spectators who came to applaud Obama four years ago.Thousands of police  the official figure has not been made public  will fan across the area, with several posted at every street corner.Airspace over Washington will be under tight surveillance, as will the Potomac River that runs along the city.Teams on horseback and with bomb-sniffing dogs will crisscross the city looking for potential explosive devices.More than 13 000 soldiers will attend the parade, behind a security cordon, to escort President Obama and to keep watch on the Capitol, the seat of Congress where he will be officially sworn into office.There will be cameras everywhere surveillance, media and tourist alike - a number of roads around the Mall will be closed to vehicles and spectators will be thoroughly searched, controlled and screened at each checkpoint.On the roofs of the main buildings in the area, snipers will stand watch."We're prepared for a variety of threats," said US Capitol Police spokesperson Shennell Antrobus.He expressed confidence in the force's "robust, multi-task security plan" that has been in the works for months.Michael Clancy, deputy assistant director of the FBI's counterterrorism division, said "the bigger threat, the thing that keeps you awake at night, are the lone offenders, regardless of their affiliation"."Those are the ones that scare me the most, folks that we don't have on our radar. It's the Timothy McVeighs of the world," Clancy added in an interview.He was referring to an American former soldier turned political extremist whose 1995 bomb attack on an Oklahoma City federal building killed 168."It would be crazy for anybody to try anything because of the law enforcement in the area, but those are concerns," said Stephen Somers, vice president of operations for AlliedBarton Security Services, one of the private security firms tapped to support the force."Any lone wolf is a tremendous threat that's why security is so tight," added Somers, whose staff will be dispatched to the World Bank and International Monetary Fund."Everybody needs to be on top of their game that day."Worried about any leaks, officials have kept a tight lid on details about the security precautions.At an undisclosed location in the suburbs of Washington, a command centre will monitor in real time any developments in and around the proceedings. On the big day, agents will monitor a collage of massive flat screens and cutting-edge surveillance, while staying in contact with teams on the ground. Each one of the 42 agencies involved in security - headed by the US Secret Service that provides protection for the president will have representatives at the headquarters, the convergence of 94 bases spread across the city.Secret Service spokesperson Brian Leary said the Multi Agency Communications Centre "really gives us the ability to monitor and co-ordinate security from a central location".Antrobus, of the US Capitol Police, said this partnership helps ensure that everyone can "enjoy the democratic process and this historic day".Officials are also keen on avoiding a repeat of the planning mishaps of 2009, when thousands of spectators were stuck in a massive freeway tunnel for hours in the freezing cold, and missed Obama's speech.Survivors of the ordeal dubbed it the Purple Tunnel of Doom.

NEWS,27.10.2012

Economic report not all bad for Obama

Republican challenger Mitt Romney used a government report showing tepid economic growth to hammer President Barack Obama less than two weeks before Election Day, but the report also had some good news for the president.With the Commerce Department reporting a modest 2% growth rate unlikely to make a big dent in unemployment, Romney said Obama inherited a bad situation when he took office and "made the problem worse." He criticised Obama for failing to reduce borrowing and spending, protect entitlement programs or reach deals with Republicans.The report also provided ammunition for Obama: It showed the economy grew for the 13th straight quarter at a rate that - though modest - beat expectations. Obama claims progress during his term on fixing the economy, though conceding it hasn't been fast enough, and says Romney's policies would only make matters worse.The economy remains the race's dominant issue. But voters who are still undecided aren't likely to be swayed by Friday's mixed report from the Commerce Department, experts said.Growth in the July-September quarter climbed slightly but was still too weak to stir significantly more hiring. The pace of expansion increased to a 2% annual rate from 1.3% in the April-June quarter, led by more consumer and government spending. This year's third-quarter growth is slightly below the 2.2% average pace since the recession ended in June 2009."For the average American, I don't think changes in quarterly GDP" make a big difference in their perception of the economy, said Andrew Kohut, president of the Pew Research Centre. "It's certainly good for the president that the number is not bad because that would resonate."With 11 days until the election, the economy is being kept afloat by revitalised consumer spending and the early stages of a housing recovery. But more than three years after the Great Recession ended, the US continues to struggle because businesses are reluctant to invest, and slower global growth has cut demand for American exports. The recovery is still the slowest since World War II.The latest report did exceed expectations in GDP growth and showed some progress in consumer spending, which drives 70% of economic activity.Obama took office during the worst downturn since the Great Depression and says his policies stabilised the economy later that year. He argues that his massive stimulus package and auto bailout helped it grow in 2010.

 

US economic growth accelerating

US economic growth accelerated in the third quarter as a last minute spurt in consumer spending and a surprise turnaround in government outlays offset the first cutback in business investment in more than a year.Even so, the stronger pace of expansion fell short of what is needed to make much of a dent in unemployment, and it offered little cheer for the White House ahead of the closely contested Nov. 6 presidential election.Gross domestic product grew at a 2% annual rate, the Commerce Department said on Friday in its first estimate of the third quarter, a pick-up from the second quarter's 1.3% pace. But to make substantial headway cutting the jobless rate, the economy needs to grow by more than a 2.5% pace over several quarters.The growth was a bit better than economists had expected, in part because of a surge in government defence spending, which was not expected to last. defence spending rose at its fastest pace in three years, and combined with the rise in household consumption and a jump in home building to strengthen domestic demand."The economy still has only weak forward momentum," said Nigel Gault, chief US economist at IHS Global Insight in Lexington Massachusetts. "Some underlying fundamentals are improving, but uncertainty at home and abroad is holding back the business sector."US stocks ended the day little changed, with corporate earnings holding greater sway over market sentiment, while Treasury debt prices rose. The dollar was flat against a basket of currencies.Since climbing out of recession, the US economy has faced a series of headwinds ranging from high gasoline prices to the debt turmoil in Europe and, lately, fears of US government austerity. The economy has struggled to exceed a 2% growth pace and remains about 4.5 million jobs short of where it stood when the downturn started.White House adviser Alan Krueger said the GDP report underscored the need to extend tax cuts for the middle class and small businesses, as President Barack Obama has proposed. Obama's Republican challenger, Mitt Romney, described it as evidence of the president's failed policies.In the third quarter, consumers shrugged off the impending sharp cuts in government spending and higher taxes that are due early next year and went on a bit of a shopping spree, buying automobiles and snapping up Apple Inc's iPhone 5.Consumer spending, which accounts for about 70% of US economic activity, grew at a 2% rate after increasing 1.5% in the second quarter.A separate private-sector report showed consumer sentiment rose this month to its highest point in five years, another sign households are little worried by the looming fiscal cliff at year end that will raise income taxes and is estimated to drain about $US600 billion from the economy next year unless Congress acts.High stock prices and firming home values have made households a bit more willing to take on new debt, supporting consumer spending even in the face of higher gasoline prices.An inflation gauge in the government's GDP report rose at a 1.8% rate, up from the second quarter's 0.7% pace. But a core measure that strips out food and energy costs slowed to a 1.3% rate, suggesting the rise in overall inflation will be temporary.Even so, with about 23 million Americans either out of work or underemployed, consumers might have to cut back, especially if they get slapped with a higher tax bill in 2013.Incomes were squeezed in the third quarter rising just 0.8% after accounting for inflation and taxes and households slowed their saving to ramp up their spending.Government spending, which snapped eight straight quarters of declines, accounted for 0.7%age point of GDP growth. defence outlays jumped at a 13% annual rate, the most since the second quarter of 2009, after dropping for three consecutive quarters. The surge was mainly in defence services installation, and support for both weapons and personnel.Fears of the fiscal cliff hammered business spending, which dropped at a 1.3% pace, the first decrease since the first quarter of 2011."We are being really cautious about (the) kinds of investments we make and the kinds of risks we are taking in this environment," the chief executive of consumer products maker Newell Rubbermaid Inc, Mike Polk, told on Friday.Worries over slower global growth have weighed on the corporate sector, which has issued a series of disappointing third-quarter earnings reports. According to Thomson Reuters data, 63% of companies have posted revenues below analysts' expectations; several have also announced job cuts.Slowing global demand, particularly weakness in Europe and China, caused US exports to contract for the first time since the first quarter of 2009. Exports declined by 1.6%, outstripping a 0.2% decline in imports, marking the first drop in imports for three years.Another spot of weakness in the GDP report were inventories, which were squeezed by a drought in the US Midwest. Farm inventories cut 0.42%age point from GDP growth and could remain a drag in the fourth quarter.Home building, which has been a weak spot in the economic recovery, surged at a 14.4% rate, thanks in large part to the Federal Reserve's ultra-accommodative monetary policy stance, which has driven mortgage rates to record lows.Economists say housing  the epicentre of the last recession  will contribute to growth this year for the first time since 2005.

Rightwing 'Big Bang' hits Israeli politics

The rightwing alliance between Israeli Prime Minister Benjamin Netanyahu and his foreign minister has polarised political forces in Israel ahead of next January's parliamentary election.Netanyahu and Avigdor Lieberman's surprise announcement late on Thursday that their respective Likud and Yisrael Beitenu parties would run on a joint ticket was dubbed "the rightwing Big Bang" by the Israeli press.Alongside the ultra-nationalist Yisrael Beitenu, the premier's right-wing Likud - already predicted to win the vote would be able to form a broad nationalist bloc leaning strongly to the right.Such a move would also allow Netanyahu to overcome, to some degree, the chronic instability of past coalition governments in the country."Israel needs a strong coalition government based on a political list based on genuine cooperation," Netanyahu said on Thursday evening."We ask the people to support strengthening the state, and I want a clear mandate so I can take care of the basic" issues.Israeli media quoted a survey by an adviser to Lieberman, according to which the joint list would receive 51 seats in the 120-seat Knesset, or parliament, when the votes are cast on January 22.Other polls, however, predict an outcome of less than 42 seats, the current combined number of Likud (27) and Yisrael Beitenu (15), the third largest political force in the Knesset."We are not worried about the polls, what interests us is the construction of a broad nationalist camp," Lieberman said at a news conference on Friday."Israel must move away from a reality of many parties to a system of larger parties. We will probably never reach two, like in the United States, but must achieve a system of four or five parties to ensure governmental stability," he added.Assuming his expected victory takes place, Netanyahu is certain to remain premier.But the Likud has vehemently denied a report of a premiership rotation deal with Lieberman, a populist authoritarian certain to receive a key position in the future cabinet.The leaders of the political centre and left denounced the "nationalist" and even "racist" Likud.Lieberman, a settler who was chief of Netanyahu's staff during his first term as prime minister in the late 1990s, is famous for his anti-Arab and nationalistic statements."The demon is out of its nationalistic closet. Netanyahu has removed his mask," the leader of the centre-right Kadima party Shaul Mofaz told public radio, calling on the centre to unify. "Bibi" Netanyahu and Lieberman's together might "encourage the centre-right parties to announce close cooperation in a national salvation front," wrote Yossi Sarid, former Knesset member for the left-wing Meretz party in a column in left-leaning daily Haaretz.Such a front would have "but a single mission: no to 'Biberman'."Speaking on public radio, Labour chief Shelly Yachimovich called for the creation of a "centre-left bloc, consisting of the centrist parties and moderate members of the Likud."In recent weeks media have noted the ambitions of potential candidates, such as former prime minister Ehud Olmert and former foreign minister Tzipi Livni, to head a centrist bloc to compete with Netanyahu.The Likud-Yisrael Beitenu alliance also threatens the orthodox parties, which could lose the pivotal role they have wielded in past coalitions, and they could even be excluded from the next one.According to commentators, Netanyahu's pact with Lieberman implies the adoption of at least some of Yisrael Beitenu's platform.Its policies include military conscription of rabbinic seminary (yeshivot) students and reducing the power of the Chief Rabbinate on matters such as conversions.The Israeli parliament decided earlier this month that the election would be held on January 22, 2013, nine months before its scheduled date.

EU lawmakers cancel Iran visit

A planned visit to Iran by five Euro MPs was called off on Saturday after Tehran refused to let them meet with a jailed activist lawyer and a filmmaker, just a day after the two were awarded a prestigious European human rights prize."The five MEPs were about to leave for Tehran when delegation chair (Tarja) Cronberg received a phone call from the Iranian ambassador to the EU, saying they would not be allowed to meet with the two Sakharov Prize winners," jailed lawyer Nasrin Sotoudeh and filmmaker Jafar Panahi, a European Parliament source said.Sotoudeh, 47, who is serving an 11-year jail sentence for conspiring against state security, and Panahi, 52, who is under house arrest and has been banned from making films for 20 years, were awarded the 2012 Sakharov Prize on Friday."The Islamic Republic of Iran categorically rejected any pre-conditions. Therefore this visit has been cancelled," the Young Journalists Club, an affiliate of the state broadcaster, reported on its website.The Isna news agency quoted Hossein Sheikholeslam, international affairs advisor to the speaker of parliament, as saying that Iran had "rejected a pre-condition set by the European parliamentary delegation to meet with two prisoners".EU sanctions"If the delegation agrees to visit Iran under the initially agreed conditions and agenda, then there is no objection to the visit... But we cannot accept the current pre-condition."Iran has cracked down on both since its disputed June 2009 presidential election.Sotoudeh is a leading human rights campaigner known for her work as a lawyer representing opposition activists, while Panahi has been acclaimed at international festivals for his gritty, socially critical movies.The human rights and democracy prize "is a message of solidarity and recognition to a woman and a man who have not been bowed by fear and intimidation and who have decided to put the fate of their country before their own", Parliament President Martin Schulz said on Friday.Schulz had also warned that the visit would be cancelled if the delegation was unable to meet Sotoudeh and Panahi.The rights award comes on the heels of tough new EU sanctions against Iran aimed at forcing a breakthrough in talks between global powers and Tehran on its disputed nuclear programme.After a biting oil embargo took effect in July, EU foreign ministers last week tightened the economic noose by targeting dealings with Iran's banks, shipping and gas imports.The last visit by a European parliamentary delegation to Iran was in 2007.

NEWS,23.09.2012

Obama, Romney tussle over economics

Republican challenger Mitt Romney, slipping in the polls in critical battleground states, opens an intense campaign focus in three of them on Sunday with a rally in Colorado, before heading to Ohio for a three-day bus tour and ending with a stop in Virginia.President Barack Obama, who was not campaigning on Sunday, won all three of those states in the 2008 election that swept him into the White House.With about six weeks remaining before the 6 November election, the handful of so-called swing or battleground states appear likely to determine the outcome of what has been an extremely close contest between Obama and Romney. Those states become even more critical to the Republican candidate as recent polling shows Obama opening a lead in many of them.The president is not chosen by the nationwide popular vote but in state-by-state contests. While most states reliably vote for the candidate of one party or the other, swing states like Colorado, Ohio, Virginia and five others are seen as toss-ups.Obama enters the weekend with polls showing him in a near tie with Romney nationally, but a new Wall Street Journal/NBC News/Marist Poll shows the president with leads among likely voters of 8 percentage points in Iowa and 5 points each in Colorado and Wisconsin, all battleground states. Polls published last week pointed to leads for Obama in Virginia and Ohio. While he and Romney are neck-and-neck in North Carolina, Obama has an edge in Florida and New Hampshire.With those factors pressing hard on Romney, he is intensifying his swing-state campaigning to counter criticism from Republican heavyweights that his bid for the nation's highest office is mismanaged and misdirected.PressureWall Street columnist Peggy Noonan, a former speechwriter for President Ronald Reagan, wrote recently: "The Romney campaign has to get turned around."I called it incompetent, but only because I was being polite. I really meant 'rolling calamity." Romney's evening rally at a Denver-area high school represents his first public event of the weekend.As the November vote draws near, he also is facing pressure to spend less time raising money and more time explaining his plans to voters in swing states.The schedule shift comes in the last full week before the presidential debates move the campaign into a new phase - one which Romney advisers suggest could prove pivotal following several weeks marked by negative attention, missteps and Republican concerns.Already facing reports of internal finger-pointing and foreign policy questions, Romney suffered another setback a few days ago when a secretly recorded video surfaced showing the Republican standard bearer declaring that almost half of Americans are dependent upon government and see themselves as victims.He released his 2011 tax returns on Friday, showing income of $13.6m, largely from investment income. He paid federal income tax at a 14.1% rate, lower than that of most middle-income Americans.That feeds on the Obama message that Romney is among America's super-wealthy and out of touch with the concerns of average voters.In an interview set to air Sunday night, Romney told CBS television his campaign is moving in the right direction."It doesn't need a turnaround. We've got a campaign which is tied with an incumbent president to the United States," Romney says, according to remarks released in advance by CBS.Romney spent much of his weekend in high-dollar fundraisers in southern California, a state that has gone Democratic in the last five presidential elections.As the Republican courted wealthy donors at the Beverly Hills Hilton on Saturday, Obama worked to squash Republican hopes for a resurgence in Wisconsin, where the president assailed Romney's economic approach before an energised gathering of 18 000 in Milwaukee, Obama's biggest crowd of the campaign.Obama faulted Romney for advancing a top-down economic approach that "never works.""The country doesn't succeed when only the folks at the very top are doing well," Obama told the massive crowd."We succeed when the middle class is doing well."

America's hidden unemployed

 

When Daniel McCune graduated from college three years ago, he was optimistic his good grades would earn him a job as an intelligence analyst with the government.With a Bachelor of Science degree from Liberty University in Virginia, majoring in government service and history, McCune applied for jobs at the National Security Agency, the Federal Bureau of Investigation and other agencies.But after a long hunt that yielded only two interviews, the 26-year-old threw in the towel last fall, joining millions of frustrated Americans who have given up looking for work. There’s nothing out there and there probably won’t be anything for a while,” said McCune, from New Concord, Ohio. He has moved back home to live with his parents, who are helping him pay off his college debt of about $20 000.“I don’t like it, it’s embarrassing. I don’t want to be a burden to my parents,” said McCune, adding that he felt like a high school dropout.Economists, analysing government data, estimate about 4 million fewer people are in the labour force than in December 2007, primarily due to a lack of jobs rather than the normal aging of America’s population. The size of the shift underscores the severity of the jobs crisis.If all those so-called discouraged jobseekers had remained in the labour force, August’s jobless rate of 8.1% would have been 10.5%. The jobs crisis spurred the Federal Reserve last week to launch a new bond-buying program and promise to keep it running until the labour market improves. It also poses a challenge to President Barack Obama’s re-election bid.The labour force participation rate, or the proportion of working-age Americans who have a job or are looking for one has fallen by an unprecedented 2.5 percentage points since December 2007, slumping to a 31-year low of 63.5%.“We never had a drop like that before in other recessions. The economy is worse off than people realise when people just look at the unemployment rate,” said Keith Hall, senior research fellow at the Mercatus Center at George Mason University in Arlington, Virginia.The participation rate would be expected to hold pretty much steady if the economy was growing at a normal pace. Only about a third of the drop in the participation rate is believed to be the result of the aging US population.Slow progressThe economy lost 8.7 million jobs in the 2007-09 recession and has so far recouped a little more than half of them.Economists say jobs growth of around 125 000 per month is normally needed just to hold the jobless rate steady. Given the likelihood that Americans will flood back into the labour market when the recovery gains traction, a pace twice that strong would be needed over a sustained period to make progress reducing the unemployment rate.Last month, employers created just 96 000 jobs. Roslyn Swan lost her job in 2007 as a portfolio associate at a financial firm in New York. After submitting hundreds of applications, the 44-year-old is taking a break.“Maybe after the elections,” Swan said of her next attempt to get work. “I know that I will be employed again. I don’t know when, but I know it will happen.”Americans of all ages are leaving the workforce, but the problem is most acute in the 20-24 age group, where the participation rate has plunged by 4.4 percentage points since December 2007.Many Americans typically start working in their teens, taking part-time jobs after school and over summer vacations, a tradition that is supposed to instill a work ethic.With many failing to secure jobs after graduating from high school and college, analysts worry about US competitiveness."Because of delays to their career, the skills set accumulation that normally happens in the first or third job is not happening,” said Paul Conway, president of Generation Opportunity in Washington, a non-profit, non-partisan organisation that works with 18- to 29-year-olds on economic issues.Tough on young workersLast month, the proportion of 20- to 24-year-olds in the labour force was its lowest since 1972. Other age categories are faring little better. The 25-54 age group has seen a decline of 1.8 percentage points since December 2007. Some, like 27-year-old Casey Potts, have gone back to school. She is studying nursing in Kentucky after losing her medical sales job.“If I had stayed in medical sales, I would be job searching now,” said Potts.But separate surveys by the Economic Policy Institute (EPI) and Generation Opportunity found little evidence that young people were going back to school when unable to land a job.One deterrent is the rising cost of education and record levels of student debt. About two-thirds of 2012 college graduates left school in debt, owing on average $28 700 in student loans, according to Mark Kantrowitz, publisher of FinAid.org. “Young people dropping out of the labour force to go back to school would be a silver lining if it were true,” said Heidi Shierholz, a senior EPI economist, adding that enrollment had gradually been increasing for decades.A Generation Opportunity survey published in August showed a third of young people were putting off additional training and post-graduate studies because of the sour economy.“This is significant. People are making the decision to put those off because the assurance of a return to investment is not there,” said the non-profit’s Conway, a veteran observer of the labour market as a former Department of Labour chief of staff.He said his organisation found that young people were doing unpaid internships at nonprofit groups and businesses to prevent their skills from atrophying. Others were joining the military.Some economists say the participation rate does not paint a true picture because people find work in the informal sector, ranging from legal activities such as child care to crime in some cases“People are picking a buck here and there and not being reported in anybody’s payroll,” said Patrick O’Keefe, head of economic research at JH Cohn in Roseland, New Jersey.“They will say they are not doing anything, even as they have a job and are being paid under the table,” said O’Keefe, a former deputy assistant secretary at the Labour Department. “We do not know to what extent that is going on.”

France backs more time for Greece

Greece should be allowed more time to meet deficit targets set by international lenders provided it is sincere about reforming its economy, French Prime Minister Jean-Marc Ayrault said on SundayNear-bankrupt Greece needs the European Union and International Monetary Fund’s blessing on spending cuts worth nearly €12bn ($16bn) to unlock its next tranche of aid, without which it faces default and a potential exit from the euro zone. The answer must not be a Greek exit from the euro zone,” Ayrault said in an interview with news website Mediapart. “We can already offer it more time... on the condition that Greece is sincere in its commitment to reform, especially fiscal reform.”Tough fiscal medicine prescribed by Greece’s international lenders has provoked widespread popular anger there that forms part of a broader backlash - spearheaded by French President Francois Hollande - against German-led austerity measures across Europe.So far, Greek officials have said agreement on €9.5bn of the €11.5bn package of spending cuts had been reached.That includes €6.5bn in cuts to wages, pensions and benefit payments and a further €1.1bn in savings planned from an increase in the retirement age.Responding to doubts over Hollande’s ability to deliver on his pro-growth, anti-austerity platform, Ayrault told Mediapart that a planned €120bn ($155.87bn) European Union stimulus package for the bloc as a whole was one of his successes - but that even this should only be a first step."We need to go further...120bn is not enough,” he said. “But it is better than nothing.”A poll released earlier on Sunday showed that Hollande’s approval ratings had tumbled to their lowest level since he took office in May, reflecting French impatience with his perceived inability to fight the crisis and stop job cuts. At a European level, the European Central Bank could do more to help growth, added Ayrault. “We would like to see (the ECB) go further...in playing the role of a real central bank,” he said.The ECB has over the past year brought out extra firepower in a bid to calm financial markets and spur growth in Europe, including the issuance of some €1 trillion in cheap funds to the banking sector and its recent announcement of a government-bond purchase programme.

NEWS,10.05.2012.

Obama announces support for same-sex marriage

After years of "evolving" on the issue, United States President Barack Obama said today he believes same-sex couples should be allowed to marry, taking a stand that is likely to please his political base and upset conservative voters."It is important for me to go ahead and affirm that I think same-sex couples should be able to get married," Obama said in an interview with ABC's Robin Roberts.Obama's comments marked the first time a US president had publicly expressed support for gay marriage, and his position was hailed by Democrats, gay rights groups and others as a benchmark for civil rights in the United States."This is a major turning point in the history of American civil rights" said New York Mayor Michael Bloomberg, an independent whose city is in one of six states that allow same-sex marriage.Others, including Republican activists and conservative Christian leaders, criticised Obama's stance and called it a huge political risk on a divisive issue.Noting that 29 states have approved bans on same-sex marriage, they said Obama's announcement could help his Republican opponent in the November 6 election, Mitt Romney, consolidate support among evangelical Christians who, like Romney, oppose gay marriage."Today's announcement ensures that marriage will again be a major issue in the presidential election," said Tony Perkins, a prominent evangelical leader and president of the Family Research Council, a conservative Christian group. "The president has provided a clear contrast between him and ... Mitt Romney."Romney, campaigning in Oklahoma City, said he believes "marriage is a relationship between a man and a woman". He has said he supports hospital visitation rights and other domestic partnership benefits for gay and lesbian couples.Political analysts saw Obama's move as a calculated risk at a time when polls indicate that a slight majority of Americans now support legally recognising gay marriages."It is not without political risk," Democratic strategist Julian Epstein said on MSNBC. "Polls show that nearly every segment of the population" is moving toward acceptance of gay marriage, but "Republicans certainly will try to use it as a wedge in the African American community and with non-college educated white voters," key voting blocs in which many people oppose gay marriage.Obama's comments came three days after Vice President Joe Biden said in a television interview that he was comfortable with gay marriage.Senior administration officials indicated that Obama - who had walked a fine, politically sensitive line in supporting gay rights but not gay marriage - had planned to announce his support for such marriages before the Democratic National Convention in September.The officials acknowledged that Biden's comments had moved up that timetable and said the president was not upset at Biden over his remarks.During the ABC interview, Obama described his views as personal and said he still believed that individual US states should be able to decide on the issue for themselves.Obama, who ended the Don't Ask, Don't Tell policy that prevented gays from serving openly in the US military, said his thinking was affected by watching members of his staff who are in committed same-sex relationships and thinking about "soldiers or airmen or marines or sailors who are out there fighting on my behalf and yet feel constrained."Obama told ABC his daughters were an influential factor and that his wife, first lady Michelle Obama, shared his views."You know, Malia and Sasha, they have friends whose parents are same-sex couples," Obama said. "There have been times where Michelle and I have been sitting around the dinner table and we're talking about their friends and their parents, and Malia and Sasha, it wouldn't dawn on them that somehow their friends' parents would be treated differently."Obama added "it doesn't make sense to them and frankly, that's the kind of thing that prompts a change in perspective."Nearly two-thirds of Democrats support same-sex marriage, along with more than half of independents, while fewer than one-quarter of Republicans believe it should be allowed.Obama's remarks were celebrated by Human Rights Campaign, a gay rights group, which said he had "made history."Neera Tanden from the Center for American Progress described the president's expression of support as "another large step toward realizing this country's promise of equality." Republican gay rights activists praised the decision but were more muted. "I am sure the president's newly discovered support for marriage is cold comfort to the gay couples in North Carolina," said Christopher Barron, chief strategist of GOProud.North Carolina voted yesterday to join 28 other states that have voter-approved constitutional bans on same-sex marriages, according to the National Conference of State Legislatures.Six states and the District of Columbia allow gay and lesbian marriages.In Colorado on Wednesday, a bill that would have granted civil unions to same-sex couples failed to advance to a full vote.Celebrities have praised Barack Obama after he announced that he supports gay marriage.The comments have led to a massive response on twitter with many gay and lesbian stars as well as LGBT campaigners posting their thanks.Talk show host Ellen DeGeneres tweeted: "Thank you President @BarackObama for your beautiful and brave words. I'm overwhelmed."While Chris Colfer retweeted Ellen's comment and added his own words of praise.His Glee colleague Jane Lynch said: "Pretty darn happy today. Thanks Mr President, for supporting the dignity of my family and so many others!"Born This Way singer Lady GaGa added: "Obama, congratulations on being the first sitting President to support marriage equality. Feels like the future, and not the past. #NoFear"

NEWS,05.05.2012.

Obama unleashes negative barrage on Romney

 

President Barack Obama wants to tell America a few things about Mitt Romney: He is rich and indifferent, bad for women, and might wobble at a fateful moment as commander-in-chief.Obama's re-election campaign has unleashed a daily, negative, character-based slashing of his November foe, ahead of the president's official campaign kick-off rallies in the crucial battlegrounds of Virginia and Ohio on Saturday.In the latest volley, Obama's camp produced a memo accusing Romney of pursuing an "extreme" agenda towards women, seeking to lock in the Republican challenger's liabilities with the key electoral demographic.This followed an ad branding Romney's attitude towards the middle class as "just what you would expect from a guy who had a Swiss bank account".Obama weighed in during his victory lap marking the anniversary of the killing of Osama bin Laden, questioning whether Romney would have made the gutsy call to launch a high-risk Navy Seal raid.An ad featuring an admiring ex-president Bill Clinton made a similar point.Hope and change, circa 2008, this is not.Obama supporters point out the president is not alone in going negative: The Romney campaign flexed a true mean streak in the Republican primary.Hard-charging Romney campaign operatives and outside groups flush with corporate cash are meanwhile readying the next anti-Obama barrage.But Obama's tactics reflect a need to amplify Romney's weaknesses to disqualify him as a potential president at a time when a stuttering economy is clouding his own prospects."Romney is coming off a bruising nomination battle that raised some doubts about his character and wants to reintroduce himself to the American people," said Professor John Geer, a negative campaigns expert at Vanderbilt University."The Obama campaign is not going to allow him to do that without continuing the choir of criticism. They want to raise some doubts about his character and make him look extreme on issues."Obama's attacks also seek to frustrate any bid by Romney to trek to the political centre where American presidential elections are often won."What the president is doing in terms of campaign tactics, and his strong criticism of Mr Romney, is not unusual for an incumbent," said Peter Brown, assistant director of the Quinnipiac University polling institute."Elections in which there is an incumbent are referendums on that incumbent, and given the president's relative lukewarm job approval ratings... his team has obviously chosen to try to demonise the opposition."Obama's assaults partly focus on Romney's history as a millionaire venture capitalist who Democrats say sent American jobs offshore and turfed people at ailing companies out of work.Romney says his corporate past makes him the ideal man to turn around the economy, which is giving off conflicting signs of recovery and slowdown in a slow trudge out of the deepest slump since the 1930s Great Depression.That is where the Swiss bank account comes in, as Obama hints that he, and not his wealthy foe, best understands middle class economic angst.A Quinnipiac poll on Thursday underlined Obama's challenge, putting the president just two points up on his foe, 44 to 42%, in the crucial state of Ohio.The race in the rustbelt battleground has tightened because signs of an improving economy have ebbed, the pollsters said, sharpening the row on pocketbook issues six months from election day.Obama's standing in swing states is underwritten by a wider appeal to women voters. He leads Romney among the group 44-42% in Florida, 50-37 in Ohio and 52-35 in Pennsylvania, the poll showed.So, hitting on women's issues, and reviving recent controversies over contraception, for instance, makes sense.Some Obama spots are airing on television already in battlegrounds like Iowa, Ohio and Virginia, while others run on the web or are farmed out to journalists in a bid to shape news coverage.His campaign has also produced longer, inspirational films aimed at convincing supporters Obama delivered the change he promised.Republicans are meeting Obama's assault head on and have a new bumper sticker-style slogan "Hype and Blame" - a play on Obama's 2008 "Hope and Change" theme, and accuse the president of slamming Romney to hide his own faults."Successful incumbents usually run on their record. Failed presidents run from their record," said Republican National Committee chairperson Reince Priebus.

Japan nuclear power-free as last reactor shuts

Japanese utility Hokkaido Electric Power Co began shutting the country's last active nuclear reactor today, leaving the world's third-biggest user of atomic energy with no nuclear-derived electricity for the first time since 1970.A crisis at Tokyo Electric Power's Fukushima Daiichi nuclear plant, where an earthquake and tsunami in March last year triggered radiation leaks, has hammered public faith in nuclear power and prevented the restart of reactors shut down for regular maintenance checks.Hokkaido Electric said it started lowering output from the 912-megawatt No 3 unit at Tomari nuclear plant in northern Japan at 8pm (NZT).The maintenance on the unit is set to begin at around 2am (NZT) when power generation falls to zero, with the unit to be shut down completely by the early hours of Sunday.The shutdown means all of Japan's 50 reactors have been taken off line, marking the country's first nuclear power-free day since May 1970.Trade Minister Yukio Edano and three other ministers have been trying to win the support of communities to reactivate two idled reactors at Kansai Electric Power's Ohi nuclear plant to help ease expected power shortages of nearly 20% in coming hot-weather months.The two Ohi reactors are the first to be considered for reactivation by the central government, but it faces an uphill battle of winning public support.Kansai Electric's expected deficit for this summer was the highest among four Japanese nuclear plant operators that forecast shortfalls when demand peaks in the summer.The last time Japan was nuclear power-free was for five days to May 4, 1970, when the two reactors then existing were shut for maintenance, according to the Federation of Electric Power Companies of Japan.