Job Adds

Reports of the Work Department have shown 240,000 American citizens have lost their jobs only in the past month of October, increasing to over 1,2 million the number of unemployed in the US only from the beginning of 2008.

Unemployment rates have thus increased from 6,1% in September, to a 6,5% at present; this high number has not been reached in the US since March of 1994.

More than half of the people who lost their jobs this year, have become unemployed in the last three months; specifically, 127,000 in August, and 284,000 in September.

Most of those affected were working in the fields of construction and manufacturing, while fields like coalmining and health were even requiring more personnel.

In constructions, 49,000 people have lost their job, which has created a new record of 10 million unemployed constructions-related workers, phenomenon not seen since 25 years ago.

Financial analysts do not seem to be confident the situation will get better any time soon.

Yahoo Offices

Google has announced they will no longer go ahead with the advertising partnership with Yahoo that they were negotiating on.

The discussions started this June, after Microsoft had announced they do not want to buy Yahoo anymore.

As consequence, Yahoo went to Google with the proposal of an advertising partnership, which meant that Yahoo would be displaying Google’s ads.

This deal was only available for the US and Canada, for a period of 4 years, and it would have brought Yahoo approximately 800 million dollars every year.

The competition authorities have said they would be analyzing this deal very thoroughly; and they did. In October, they had already imposed a temporary delay of the deal, and this week they have changed the terms under which they would accept it.

The deal could only last maximum two years, Yahoo could only receive from Google a 25% of the profits obtained as consequence of the deal; moreover, the customers who advertised in Google could ask not to appear in search lists made in Yahoo searches.

Google have announced that they cannot accept these terms and regret this could not happen, as they think it would have been a good thing for all those involved.

People Bidding at a Christie's Auction

If anyone needed one more piece of evidence that America is going through an economy crisis, they have it now.

The latest painting auction organized by the New York auction house Christie’s has been a major disappointment.

Famous paintings by Cezanne, Manet, Renoir and Klee have not found their buyers this time.
Out of the 30 paintings, 7 were not sold at all, and many of the others were sold at lower prices than they have estimated.

Composition métaphysique, by Giorgio de Chirico, was sold for the highest price, 6.1 million dollars. Christie’s was also happy with the price they got on L’empire des lumières, by Magritte, which was of 3.5 million dollars.

The same thing happened to Sotheby’s this week; they have registered the worst auction sale since May 2001, and they did not manage to sell more than one third of famous paintings by Modigliani, Van Gogh and even Picasso.

Mastercard Logo

Mastercard, one of the world’s most important credit card providers, has suffered a loss in incomes for this year’s third quarter, due to legal charges.

The company had to pay approximately $515 million to rival Discover Financial Services on accounts of an anti-trust settlement.Despite the charges, Mastercard has managed, much to the surprise of financial analysts, to obtain quite a high profit, due to an increasing number of transactions.

Mastercard representatives have declared that they have not really felt the effect of the world crisis, but they expect to do so sometime next year.

They hope it will not last more than six months and are aware Mastercard will probably not meet the revenue growth they had initially planned for 2009, and foresee a decrease of somewhere between 12%- 15%.

UBS Switzerland

UBS, the largest bank in Switzerland has issued its quarterly financial reports.

Analysts were surprised to see that the bank had reported a profit, after having suffered losses every quarter of the past year.

Their profit for the months of July, August and September have been of about 256 million dollars.

Bank representatives have declared that the present quarter is looking quite promising, due to the 6 billion Swiss francs they raised from the government and some operations with about 60 billion dollars.

Still, they fear the consequences of the world crisis; they are aware that the falling economy will most likely affect the financial situation of many of their customers which will immediately affect the bank’s revenues obtained out of fees and account administration taxes.

USB is undergoing a lot of changes lately and the latest is a personnel cut of about 1,900 people, which means their situation is not as good as one may think.

Check-in Desks on Terminal 5, Heathrow Airport

London Heathrow’s newest and biggest terminal, T5, was officially open in March 2008.

Destined exclusively for British Airways flights and passengers, T5 is, architecturally speaking, a great creation.

The problem is architecture cannot run itself and has to let people do it. And that is how a great terminal turns into a great disappointment. When it first opened, all the passengers could see was a severe lack of communication between British Airways and the British Airport Authorities: flights were cancelled, people had to wait in long queues for refunds or alternative flights, some of the baggage belts were not properly working which led to baggage loss.

The poorly trained personnel were not ready to handle the more than 36,000 passengers T5 received on the first day.

Everybody was disappointed: the customers, the transport authorities, the union representatives.

Seeing BAA’s lack of efficiency, the Competition Commission’s report on UK airport ownership even suggested that BAA should sell some of its important airports, such as Gatwick, Edinburgh, Glasgow and even Heathrow.

Things didn’t look too good for BAA then; but ever since March things have changed. T5 authorities (BAA and BA) have made great efforts to bring everything on a normal course.

They now strongly claim all is going very well, even above standards in some respects, and that the majority of the 11.5 million passengers they’ve had since March are highly satisfied with T5 services.

Ryanair Aircraft

Low-cost airline Ryanair is setting up a major cheap seat campaign: US flights for only 10 euros (£8) each.

On Monday, the company will announce its financial situation for the third quarter and will also give more details on their latest campaign.

Michael O’Leary, Ryanair Chief Executive, has told the press that they will compensate the low cost economy tickets with very expensive business class ones.

This cheap seat sale for the US will be possible due to the company’s intention of buying approximately 50 aircraft from its competitors, and of opening more new routes, thus attracting a larger number of customers in the future.

The US flights will most likely be available at the end of next year for earl bookers who want to travel from London Stansted and Dublin to New York, Florida, Los Angeles, San Francisco and Boston.

The customer will pay the 10 euros for the ticket and the airport taxes, which are not included in the advertised price.

Saddam Hussein's Yacht

Iraqi authorities are about to sell late leader Saddam Hussein’s yacht the following days.

The Iraqi government has just won a legal battle with a Jordanian company that seemed to be claiming the yacht belonged to them. The company, partly owned by King Abdullah of Jordan, said that the yacht had been given to them as a gift.

But the French judge who presided over the case ruled in favour of the Iraqi government.

The luxury yacht, called Ocean Breeze, is 82 meters long and has an estimated worth of over 30 million dollars. The value is given by the several swimming pools, a theatre, a helipad and, of course, by the fame of its former owner.

Although the yacht’s value is more than obvious, the sellers fear they may have a hard time selling it because of the way it is decorated.

As the luxury yacht of the former leader of an Arab country, Ocean Breeze fully expresses the Arabic decoration style: mahogany carvings, lots of golden details, bright colours, carpets.

Brokers hope to get around 35 million dollars for it and emphasize, most of all, its historic value.

Sinowal Trojan

The Sinowal Trojan is a virus that is amongst the most advanced inventions of cyber crime. It infects your computer and you don’t even know it is there.

Hackers used it to steal crucial information about approximately 500,000 online bank accounts and cards (credit and debit).

The RSA first detected the Windows Sinowal in 2006, and since then it has continued infecting computers in countries such as the US, UK, Australia and Poland.

The Trojan virus uses an infection method that is known under the name of “drive-by downloads”, and your computer will be affected even if you access a website that has been coded with a Sinowal code.

The main problem with this virus is that, although it has been discovered two years ago, there is no way of stopping it, since its creators are constantly releasing new variants to stay ahead of time.

The issue is now under law enforcement agencies jurisdiction, but they are also having a hard time finding out information about who is behind Sinowal.

Since May of 2008, Sinowal has infected over 100,000 web pages and it is estimated that it keeps infecting a few thousands a day, which means one every few seconds.

Alitalia Aircraft

Alitalia, Italy’s national airline company, has been in a critical situation ever since two years ago. Several attempts have been made to save the company since then, and airlines such as Air France-KLM, Lufthansa and British Airways have been involved in the process.

On Friday, the Italian investors’ group CAI (Compagni Aerea Italiana) has made a 1 billion Euros offer for Alitalia and they hope that in the future they will be able to join one of the major European Airlines.

Unfortunately, this offer has a down size, as this purchase will mean that more than 3,000 people will lose their jobs. Some Alitalia trade unions are still against this offer, although negotiations have been carried out for a long time.

The rescue plan states that CAI will have 12,500 people working for Alitalia, 3,500 less than now. Apart from the personnel cut, they will also cease activity on unprofitable routes and will get rid of some of the older aircrafts.

Experts advise the deal must follow EU competition rules; otherwise Alitalia is sure to declare bankruptcy.
The Italian government has even made modifications to the bankruptcy laws in order to keep the national airline alive, and the Prime Minister Silvio Berlusconi is most keen to settle a deal as soon as possible.

Exxon Sign

Exxon Mobil strikes again. Between July and September they have made the highest profit an US company has made over three months.

For Exxon 2008 has been a very prosperous year, and they managed to get high profits even when the oil prices were continuously rising.

They made $11.68bn in the second quarter of this year, and an amazing &14.83bn in the third quarter, which meant a 58% rise compared to last year profits for the same period.

The profits made up until this point are 29% higher than the ones they obtained in the first nine months of 2007, and company representatives attribute this success to their way of approaching the business, which implies a strict discipline.

The oil prices have fallen $1.91 and reached a new low of $65.59 a barrel for the December deliveries.

Also, Exxon’s activity has been temporarily affected by the hurricanes Gustav and Ike which will cause the company to lose about $500m of the Oct-December profits.

BMI Aircraft

British airline BMI, Heathrow second -largest airline, will be taken over by German airline Lufthansa.

Lufthansa already owns approximately 30% of BMI shares and now it will buy another 50% from Sir Michael Bishop, the airline’s owner. This deal will bring Lufthansa in close competition with Heathrow’s main airline, which is British Airways.

The German carrier will take over the 54 planes and the flights to the 51 destinations BMI was dealing with, as well as an average 10 million passengers a year.

This deal was somewhat sealed since 1999, when Lufthansa signed an agreement that if BMI would ever sell their shares, they would buy them. The final signature is to be given on the 16th of January, if the British competition authorities have no argument. The contract has an estimated worth of about £318 million.

Lufthansa is already experienced in taking over other airlines, as proven by the integration of Swiss Airlines some time ago.  They have declared that there will be no personnel made redundant and that things will basically stay the same.

The remaining 20% of BMI are currently owned by Scandinavian Airlines (SAS).

Porsche Logo

Porsche representatives have declared that they have raised their stake in Volkswagen to 42.6% and are hoping to own the majority package of shares in the European carmaker.

Porsche already owns 35% of Volkswagen, which makes them the biggest shareholder already, but they want to buy even more. Still, they do not wish to create a merger. Their goal is to form an alliance strong enough to face the competition and obtain better sales numbers, more customers and more performance and prestige.

This collaboration is quite important for both companies, seeing that the car market has been affected by the world financial crisis as well.

A few weeks ago the negotiations were put on hold because of some family misunderstandings between Wolfgang Porsche and Ferdinand Piech, the cousins running the two businesses; they seemed not to agree on how to organize this take-over. Luckily, both families have come to an agreement and we can expect the official announcement of the take-over by the end of this year.

Ryanair Aircraft

Low-cost company Ryanair had about 70 flights from and for Valencia, Spain. They had 750,000 passengers a year and several hundred people were collaborating with them.

All the flights towards the 10 European destinations will be cancelled starting the 4th of November.

The closing of the Valencia base comes as a result of a lack of agreement between the company and the local authorities. The Irish executives say that the airport did not get enough promotion and neither did the Ryanair routes and flights.

The carrier advised they had invested more than £85 million, consisting of two aircrafts based in Valencia, and have directly employed about 60 persons in Valencia. The good news is that they have the opportunity to keep working for Ryanair, if they accept to relocate to another base.

The airline’s representatives opened the base in August last year, and they were satisfied with how things were going, but they could not go past the local authorities’ refusal to collaborate and to offer them at least part of the privileges and funds they granted the local airline, called Air Nostrum.

Sandisk Logo

After six months of negotiations and waiting, Samsung Electronics had decided to put an end to the Sandisk buying process, seeing that the US flash memory card producer has not yet accepted the price they were offered.

Sandisk, based in California, saw the 26 dollars a share price as too low, and did not accept it, although the total amount would have been of 5.9 billion dollars.

Apparently Samsung made the right decision; the price of Sandisk shares had already fallen approximately 6%, which means a share is now valued at 13.72 dollars in the Frankfurt trade, and 14.76 in the US one.

Samsung also based its decision on the problems Sandisk has been having lately: they announced a 250 million dollar loss, they had to make major personnel cuts, and they most likely will suffer quality losses in their products.

Also, Sandisk renegotiated their contracts with Toshiba, Samsung’s rival, which Samsung managers could not overlook.

Exelon Nuclear Power Plant

Exelon Corp. has offered 6.2 billion dollars in stock to purchase the New Jersey based NRG Energy. This buy would mean a great territorial expansion for Exelon Corp., based in Chicago; also, their merge would create a company whose value would sum up to over 60 billion dollars.

NRG officials have not yet reacted to this unsolicited buy proposal, but it seems that they are not very thrilled about it.

Exelon Corp. operates under the environmentally friendly principle and all 17 nuclear reactors that they handle produce very low quantities of greenhouse house emissions.

They have stated that this merge with NRG would keep them amongst the less polluting energy companies in the United States.

Also, they have tried to describe this merger as a win-win situation for the involved companies; Exelon gets territorial expansion, NRG gets leverage on the 8 billion dollar debt and better credit rating, and together they get to produce about 47,000 MW, which would be enough to provide electricity for about 45 million homes in the US.

At present, shareholders from both companies are analyzing the merger and the results will be communicated to the press as soon as a final agreement has been reached.

Food Prices Raise

After a serious increase, the oil prices go down more than they have for the last year. The problem is this does not seem to reflect in the price of all other products, especially in that of alimentary goods.

Even though producers pays less for transportation, and so do retailers, the food prices have not lowered a cent. The high prices are not willing to just disappear from the supermarket shelves, especially that it is to nobody’s disadvantage, apart from the buyer’s, of course.

But, as in all fields, there are also companies who have chosen not to raise prices along with the oil’s because they feared they may loose customers who will go choosing a cheaper alternative.

An example is Tyson Foods, Inc. who has chosen to bear losses but keep the number of customers rising, then act like the majority of the companies.

Coca Cola and Pepsi have not made any announcements about future price changes, whereas Anheuser-Busch Cos. Inc. and SABMiller’s U.S. have both raised their price for beer.

L.A. Live Project Plan

The Anschutz Entertainment Group has offered 500 job opportunities to the inhabitants of Los Angeles through their project, called L.A. Live.

The positions offered are in restaurants and several other entertainment types of companies that are planned to open over the next few months in Los Angeles.

Approximately 3,000 people were waiting in downtown LA to apply for a job at Lucky Strike Lanes and Lounge or the Grammy Museum; people had been standing in a line since very early in the morning, despite the fact that the interviews did not until 10 o’clock. They came there with the hope of getting a job as a waiter, cook, security guard, and housekeeper.

The salary will be around 10 dollars an hour with benefits, which the organizers say it will ensure the employee a decent living wage for LA; they also point out that tips will most likely enhance the monthly income.

The employers want to give jobs to locals who can ideally commute to work every day, as the South Park residential projects and entertainment facilities are above their buying power.

Parmigiano Reggiano

In view of the financial crisis affecting the world’s economy, Italy is faced with a crisis of its own. The Parmesan cheese (Parmigiano Reggiano) producers are extremely discontent about the ever higher production costs and the ever falling prices.

They have decided to appeal to the government for help and they ask for higher selling prices for their products, as according to them, are much lower than the fabrication costs.

Parmigiano Reggiano is considered one of Italy’s national symbols and is therefore of great importance to all, including the Government. With that in mind and also thinking about the number of jobs that would be lost, the Italian Prime Minister, Silvio Berlusconi, has initiated a series of discussions with the producers.

Market studies show that Italy produces an 11% more parmesan than eight years ago, and that happens despite the fact that the Italian populations consumes less.

Due to the abundance of producing companies, the supermarket chains can now purchase whole sale parmigiano on much lower prices than before. This is one of the reasons for which the producers ask for the prices per kilogram go from 7-7.5 euros to at least 8 -8.5 euros.

Tax Payment Form

A study requested by the Democratic Sense shows that the U.S. are confronted with an ever more worrying phenomenon – that of not paid income taxes.

Apparently, even though they have enormous sales over the year, North American companies find it hard to pay their income taxes; in fact, a statistics made by the Government Accountability Office shows that out of all the companies doing business in the United States, 57 %  avoided tax payments for at least one year in the period 1998 -2005.

Furthermore, almost 42% skipped paying taxes for two or more years, in the same time interval. In the study there weren’t listed any names of actual companies, but they did mention that some of the reasons for not paying were tax credits, moving the company’s activity to low tax countries, etc.

This year, the U.S. tax institutions have decided not to let any of these tricks work for any of the companies; they are expecting a very high budget deficit and they are willing to do whatever it takes to bring the tax code up to date and prevent companies from not paying income taxes.