MONEY MARKETS-Speculation of ECB interest rate cuts returns - Reuters
* Markets pricing small probability of ECB rate cut in June
* Such bets likely to accumulate in coming days
* As in May, markets could set themselves up for letdown
By Marius Zaharia
LONDON, May 30 (Reuters) - Bets that the ECB will cut interest rates next week are again appearing in money markets, as Spanish and Italian debt yields are approaching levels that made the central bank introduce unprecedented easing measures last year.
The threat that Greece could eventually leave the euro and worries over Spain's banking sector have prompted investors to sell Spanish and Italian debt, bringing the two countries' borrowing costs closer to levels deemed as unsustainable.
The sheer size of their debt markets and their deep-rooted connections with other financial systems in the euro zone are reasons for investors to speculate that a policy response is in the works.
The European Central Bank is, as usual, seen as the most likely institution to take measures to cool market nerves because it can act faster than politicians. It has done it before in the past by injecting around 1 trillion euros of cheap loans into financial system in December and February.
Euro zone economic data this month has also been poor, supporting bets that the ECB may soon resume monetary easing, possibly by cutting its key refinancing rate by 25 basis points from a record low of 1 percent.
"Data ... have been softer, and then you have the Greece issue continuing to be unresolved and the Spanish issue continuing to be unresolved," said Elaine Lin, a rate strategist at Morgan Stanley, whose economists predict a rate cut.
She said the euro overnight Eonia rate forward market was only pricing an over 10 percent probability of a rate cut in June and the chances were higher by another 10-20 percentage points for the July meeting. However, she expected markets to factor in a higher probability in the next few days.
A key rate cut, if also accompanied by a cut in the 25 basis points deposit facility rate, could trigger a 5-10 bps fall in the near-term forward Eonia rates towards the 20 bps level seen now in September-October Eonia forward rates, Lin said.
The lowest point on the 2012 Eonia curve is December, at 16 basis points, which implies an 80 percent probability that the deposit rate would be slashed in half, according to BNP Paribas rate strategist Matteo Regesta.
A Reuters poll of economists showed the ECB was likely to resist pressure to cut interest rates in June, but also pointed to a growing probability that it will reduce them later this year.
Speculation about ECB monetary easing has also been fuelling a rally in Euribor futures , implying bets for lower fixings of benchmark euro zone interbank three-month Euribor rates later this year.
The December Euribor future has gained back most of its losses made since Greece's inconclusive election on May 6, which sparked fears the country may be on its way out of the bloc. The fall earlier this month also coincided with unwinding bets that the ECB would have cut rates in May.
The contract was last 3.5 ticks higher on the day at 99.46. That was one tick lower than the pre-election close on May 4, but some 15 ticks higher from the lows hit in mid-May.
The move higher in Euribor futures, which has been faster than the move lower seen in the very low Eonia forward rates, has led to tighter Euribor/Eonia spreads, which are widely used as a gauge of money market stress.
That is counter to what is happening in banking credit default swap markets - where investors can insure against banking defaults. The Markit iTraxx index of European senior financials CDS remains close to its highest level this year at around 300 bps.
BNP Paribas' Regesta warned that Euribor futures could fall again as they have done after the ECB's May meeting and this would trigger a widening of the Euribor/Eonia spreads consistent with the levels of stress felt in money markets.
"You have a decoupling between those spreads and the banks CDS now, but those spreads remain exposed to significant paying interest in coming weeks ... unless there is another policy response from the ECB at its meeting next week," Regesta said.
Royal Academy of Music finance chief who swindled £100,000 from school for her pension fund jailed for 20 months - Daily Mail
By Sara Malm
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Janet Whitehouse at her court appearance at Westminster Magistrates court earlier this month, today she was sentenced at crown court
A finance director for the Royal Academy of Music who siphoned away nearly quarter of a million pounds from the charity to top up her 100,000 salary was jailed for 20 months today.
Janet Whitehouse, 56, pocketed over 200,000 from the Academy and let her son live for free in one of the school’s flats in swanky Marylebone cheating the RAM of 33,600 in unpaid rent.
She sneaked 100,000 into her private accounts and later claimed it had been approved by the college’s chairman Lord Terence Burns.
It later emerged that Lord Burns was unaware of the payments made between March 2007 and January 2011.
As well as stealing the 100,000 a further 104,000 was invoiced to Whitleys Associates, a company where Whitehouse was a director, for work she claimed to have carried out at the RAM.
She admitted in court that the invoices were ‘wholly bogus’.
The reason given by Whitehouse’s defence in Southwark Crown Court today was that she was envious of her colleagues’ pensions and was stealing the money to top her own.
Whitehouse also put her son up in one of the flats the Academy lets to students on a not-for-profit basis and let him live there rent free.
Speaking on behalf of Ms Whitehouse her defence Neil Saunders claimed that she saved the charity from financial ruin at ‘a stage where it could have essentially ended all its history and existence‘ in the mid-nineties thanks to her ‘expertise and hard work’.
She was caught out when the company carried out an audit in 2010.
After finding ‘financial irregularities’ Whitehouse, of the Isle of Dogs, East London, ‘panicked’ and faked letters purporting to be from senior staff agreeing to the transactions and later tried to get a colleague to destroy the evidence.
The Aurora Orchestra plays at the Royal Academy of Music: the charity school offers training for soloists, chamber and orchestral musicians, conductors, opera singers and composers
Whitehouse left the Royal Academy of Music in March last year and has since repaid the 236,000 she unlawfully took.
She pleaded guilty to three counts of fraud in the magistrates’ court earlier this month but the case was so serious it was transferred to the crown court for sentence.
Opening the case, Antony Swift said: ‘In August 2010, following the uncovering of an unconnected serious fraud of which it had been a victim, the RAM conducted a complete audit to check the extent of the fraud.
‘Letters were sent to all companies RAM had dealings with requesting information. Only one company refused, Whitelys Associates.
‘It was not known at the time that the two directors of this company were the defendant and her ex-husband. The extent of Whitehouse’s dishonesty was soon revealed, leading to the charges preferred against her.’
Southwark Crown Court heard Whitehouse started working at the RAM on a part-time basis in 1992 before taking over as full-time director of finance in 1998.
The Royal Academy of Music counts Annie Lennox and Sir Elton John among its alumni
Whitehouse’s defence said that she was a woman of ‘impeccable good character’ adding that the RAM had been ‘her life for almost 20 years.’
The defence said her father’s death in 2007 was the trigger as she felt financially vulnerable in comparison to her colleagues on an academy pension.
‘She started to think about her future as she did not have an academy pension like some of her colleagues. She was embarrassed to ask so instead took the extra money.’
‘This is not an excuse for what she later did and she apologised to everyone at the academy for letting them down and for how truly sorry she is.
‘She deeply regrets her actions and the position she has now found herself in. What she has done has brought her name, her family and the name of the academy into disrepute.’
Whitehouse, shared a kiss and mouthed: “I love you,” to her partner as she stepped into the dock, dabbed her eyes throughout the hearing.
Jailing her for 20 months, Judge Deborah Taylor said she had no choice but to impose a custodial sentence.
She added: ‘You were appointed in 1998 to a position of the highest trust as the director of finance and administration at the Royal Academy of Music and you abused that trust by committing serious offences over a period of three and a half years to enrich yourself and benefit your family by three different means.
‘There is no doubt you have worked hard for the benefit of the academy and it is never pleasant to sentence someone of your obvious quality and ability who has suffered such a fall from grace.’
Based on London’s Marylebone Road, the Royal Academy offers training for soloists, chamber and orchestral musicians, conductors, opera singers and composers.
The school was founded in 1822 it has boasted many famous pupils. As well as Sir Elton John and former Eurythmics front woman Annie Lennox, Lesley Garrett attended the Academy and is now one of its trustees.
Finance ministry identifies more deals to be taxed - Livemint.com
The finance ministry has identified several deals apart from the Vodafone-Hutchison transaction that will come within the tax net after the retrospective amendments introduced in this year’s budget are approved, a top finance ministry official said.
These deals, including the Vodafone transaction, are not covered under any double tax-avoidance treaties (DTAA) that India has with other countries and are likely to yield the government revenue of around `35,000-40,000 crore.
The move aims to target companies that take money out of their Indian subsidiaries in tax-efficient ways or that have acquired an Indian company or an Indian asset.
“There are around 10 companies apart from Vodafone which would be impacted by retrospective clarificatory amendment,” said the official who didn’t want to be named. “We will raise tax due from them soon.”
According to the official, these deals include Euro Pacific Security Ltd’s purchase of a 22% stake held by Essar’s Mauritius arm in Vodafone Essar; Accenture Services transaction related to its nearly 100% holding in Accenture India through Mauritius-registered entity Beaumont Development Centre Holdings; Sab Miller’s purchase of the Indian assets of Foster’s Australia; Sanofi Pasteur Holdings’ acquisition of Shantha Biotech from another French firm; Tata Industries’ deal involving AT&T’s stake in the company that is now Idea Cellular Ltd; the Sesa Goa transaction involving the purchase of Cairn UK’s stake in Cairn India; and Cyprus-based Richter Holdings Ltd, along with Mauritian company West Globe Ltd, acquiring the holding of UK-registered Finsider International Co., which held a 51% stake in Sesa Goa.
NDTV reported that Euro Pacific Security and Pan Asia, one of the companies mentioned by the official, have already paid taxes as per the income tax department’s demand. It cited a ministry official who wasn’t identified.
A Tata spokesperson said the matter was sub judice and declined to comment. A Sanofi spokesperson said the company is reviewing “the latest developments in the Indian tax law. It is too early for us to make any further comment at this stage”. Mint wasn’t able to reach the other companies on the list late on Wednesday.
Earlier this month, finance minister Pranab Mukherjee had clarified that retrospective amendments to the Income Tax Act in the budget would not override the provisions of the DTAA that India has with 82 countries. Mukherjee had added that retrospective clarificatory amendments would not be used to reopen cases in which assessment orders have been finalized before 1 April of this year.
On the Vodafone arbitration notice sent to the Indian government, the official said the government has replied to the company stating that the notice was premature.
“We have replied to Vodafone that there is no cause of action because no law has been amended,” the official said. “It is premature on behalf of Vodafone.”
On 18 April, Vodafone, through its Dutch subsidiary Vodafone International Holdings BV, sent the letter of dispute to the Indian government as the first step to initiate international arbitration proceedings under the bilateral investment protection agreement (BIPA) signed by the Netherlands and India. The government had set up an inter-ministerial group to finalise the government’s response.
Vodafone International Holdings BV bought the Indian business operations of Hutchison Telecommunications International Ltd (HTIL) through the sale of a Cayman Islands-based firm called CGP Investments (Holdings) Ltd, a unit of HTIL, also incorporated in the Cayman Islands. The tax department estimated the phone company’s tax liability at more than `11,000 crore. Vodafone and the Indian tax authorities went to court to resolve the issue.
In a 20 January verdict, the Supreme Court ruled in favour of the telecom company, saying the tax department did not have the jurisdiction to tax the transaction.
Following the judgement, the government brought in a retrospective amendment to bring similar transactions under the tax net.
remya.n@livemint.com
PTI contributed to this story.
Money Man Pulls Even With Black Guy In Latest Poll - The Onion (satire)
WASHINGTON—With the election less than six months away, a nationwide Gallup poll released Wednesday found that Money Man has now pulled even with Black Guy in the 2012 presidential race.
Citing Money Man's significant appeal among veterans—as well as his narrow lead in Florida, a crucial swing state that went to Black Guy in 2008—experts said Money Man is closing the gap on a race that, until quite recently, seemed to be firmly under Black Guy's control.
"I have to say, Money Man has really impressed me lately," said poll respondent Mike Hargett, who is among the 45 percent of independent voters planning to cast a ballot for Money Man in November. "I voted for Black Guy in the last election, but I’ve been fairly disappointed with the job he’s done. As much as I admire Black Guy and his historic achievement, it just seems like the time is right for someone new with fresh ideas to come in and shake things up a bit."
"Someone like Money Man," Hargett added.
Still, Money Man’s current one-point lead over Black Guy is within the Gallup poll’s margin of error, and Washington insiders have pointed to several encouraging signs for Black Guy, who maintains strong ratings on foreign policy and a double-digit lead in favorability among middle-class voters—two areas in which Money Man typically hasn’t polled very well.
Further highlighting the closeness of the race, the poll revealed there are a significant number of undecided voters still weighing the merits of a Money Man presidency vs. a Black Guy presidency.
"It's a tough choice, because both Money Man and Black Guy have strong qualities," said 47-year-old voter Albert Dorin, adding that he may not make up his mind until he sees Money Man and Black Guy next to each other on a stage, debating. "I like Money Man’s views on the economy and on money. However, you have to hand it to Black Guy for finally tracking down and killing bin Laden. And I like his wife, Black Lady, too."
"I like her more than Money Man’s wife, Blonde Lady," Dorin added.
Despite Money Man's rise in the polls, surveys have found that a majority of Republican voters would have preferred to see Food Man from New Jersey on the ballot, had he chosen to run, and that there also would have been strong support for The Woman, especially among the conservative base.
"Food Man from New Jersey or The Woman would have been more in line with my sensibilities, but there's still a good chance Money Man will pick one of the two as his running mate," Ohio voter Margaret Yaster told reporters. "Besides, for me, pretty much any Republican would be better than Black Guy. Even Pizza Black Guy."
"Not Ron Paul, though," Yaster continued. "That guy's out of his goddamn mind."
The Business Finance Store Discusses How to Appeal to the Millennial Generation - YAHOO!
The Business Finance Store discusses some recent findings on consumer habits that could help small businesses increase their sales.
Santa Ana, CA (PRWEB) May 30, 2012
According to research firm Technomic, businesses must be more socially responsible to appeal to the Millennial Generation (ages 19-34), the Sacramento Bee reported. In Technomic’s recent study “Understanding the Foodservice Attitudes and Behaviors of Millennials,” the research firm found that this younger cohort tends to look for such things as social responsibility, sustainability, local, and organic, grass-fed, and hormone-free offerings when dining out. However this information is relevant beyond the food service industry. In the recent blog post "Earn More by Targeting Millennial Shoppers, Tech-Savvy Texans and More," The Business Finance Store discusses some recent findings on consumer habits that could help small businesses increase their sales.Information on different demographics can be useful in helping small businesses increase their sales. Keeping up with the latest trends and understanding one’s client base can reap huge rewards. Read more about how small businesses can cater to different demographics at The Business Finance Store Blog.
The Business Finance Store is a business financing and consulting firm that offers customized Business Financial Solutions. Seasoned professionals offer assistance in a variety of financial solutions to help small businesses succeed such as:Business Financial Solutions, Legal Solutions, and Accounting Solutions.
The staff at The Business Finance Store understands that starting and growing a business is an exciting time. They keep it exciting by taking care of some of the most difficult aspects, by providing legal advice, helping with vital responsibilities like accounting & bookkeeping, and by obtaining business finance. They can quickly and easily guide entrepreneurs through many different complicated processes and put them on the path to success.
For 10 years The Business Finance Store has been helping startups and other small businesses legally structure their companies, find the right franchises, get the funding they need, and achieve the American Dream of owning their own successful business. Since expanding nationwide in 2007, they have helped thousands of companies and have funded over $60 Million in business credit lines, not including SBA loans. The Business Finance Store sees limitless potential in the current climate, and looks forward to many strong years of growth to come. Take some time to review their services, and give them a call.
For more information, or a free, no-obligation analysis of your business needs, visit The Business Finance Store website: http://www.businessfinancestore.com. A member of their professional staff will contact you to discuss your business' short and long-term goals. Whatever you need, The Business Finance Store is there.
Kelly Rye
The Business Finance Store
(949) 777-5959
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20 Months.? let out after 6 for good behaviour? CRIME PAYS.
- armstrong, London, 30/5/2012 19:16
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