Emotions run high at candlelit vigil for three men killed in riots as Asian communities weigh up response to tensions When the prime minister, David Cameron, said on Wednesday the riots had brought out “some of the best of Britain”, he could not have known how fitting that description would be of events on a petrol station forecourt in the suburb of Birmingham 12 hours later. Spilling out in the road beside the Jet Garage, where three Asian men were killed the previous night, around 300 Muslim and Sikh men gathered to debate how they should respond to the tragedy. There were no politicians in sight – no official community spokespeople or religious leaders. These were local men, struggling to know how to manage their grief and anger. Candles marked the spot where Haroon Jahan, 21, and brothers Shazad Ali, 30 and Abdul Musavir, 31, had been killed in the early hours of Wednesday. The three were part of a group of around 80 guarding the petrol station, on Dudley Road in Winson Green, when they were victims of a hit-and-run. A murder inquiry has been launched, and a 32-year-old man is being questioned. After prayers and a silent vigil, men took turns to express their views. There had been fears that the meeting, held after last prayer of the day – Isha’a – would be a flashpoint, sparking a further round of rioting and looting. It was clear from snatches of conversation that there were some in the crowd – a minority – who wanted to reap revenge on the black community, who they held responsible for the deaths. They did not prevail. It is hard to explain how the men gathered in the dark reached the conclusion they did. There was no leader; the forum was open for people to speak and disagree. The consensus among most – after half an hour – was that a planned march should not take place, in part because it would be disrespectful to the families of those who died. Not everyone agreed – and it was impossible to know whether dissenters would break away later in the night and, in breach of the general will, seek retaliation. However, community relations in Birmingham play-out in the days and weeks to come, the meeting of Dudley Road will serve as evidence of a determination among many not to allow the violence to spiral. Standing on the wall of the forecourt, one Sikh man, Harpreet Singh, 28, began by imploring others not to take to the streets. He said they had gathered to pay their respects to the deceased and prove they were united. He announced the families of the dead men did not want them to march on the city centre, as had previously been planned. “We need to tell the media we will not tolerate the tyranny, but we will not react either. We are capable, but we will not do it,” he said. Singh concluded there were two possible outcomes – either they would protest, and the media would label them “extremists”, or they would act “nobly” and be perceived as a community united. He added: “You decide. I will stand with you all the way. I speak to you on behalf of all the Sikhs who were guarding the gurdwaras and mosques yesterday.” Some in the crowd, both Muslim and Sikhs, instantly agreed. Others did not, insisting they had come to protest. “I say peacefully march man,” one man shouted. Another said: “Okay, I’m here to do a march, you get me? Let’s do a march – but keep it peaceful,” said one man, in his 20s. “Yeah, but it won’t stay peaceful,” interjected someone else. “I know my brothers, it won’t stay peaceful.” Another voice from the crowd added: “Whoever makes trouble man, we are going to have to deal with them ourselves. No matter who you are, no matter which area you’re from, you are going to get beaten by our elders.” There were some chants of “march, march, march”. There was another shout of “not today, not today,” followed by “who wants a peaceful march – hands up?” A sizeable portion of hands were raised. Many, it seemed, had come expecting a demonstration. An hour before the debate started, the atmosphere had been highly charged, as groups gathered for silent prayers for the dead men. The crowd consisted mostly of young men, many had hoods pulled over their head. A small number – five or six – had scarves concealing most of their faces. There were older men too, and some community elders. Police kept a low profile at the edge of the gathering. A few held their hats under their arms as prayers were said. Speaking before the debate about whether to protest began, Shaheen Kayani, 46, cab driver from nearby Hodge Hill, said the Muslim community was pulling together to prevent trouble. “Everybody says to their sons: please don’t start another riot. People don’t want trouble any more. I just say we want peace, peace, peace.” Some of the younger contingent sniggered as he spoke. They were the same teenagers quietly shaking their heads later, listening on from the fringe of the meeting as the tide of opinion turned against street protest. Some of them urged a reaction. “They’ve killed them for free, bro,” said one man. Others made racist comments about the looters and suspected murderer. But when a man pointed his finger in the air, shouting: “We are going to protest to let them now how we feel”, he was shouted down. The crowd had been building, and was halting the traffic. Police gathered nearer to deal shepherd people off the road. There appeared to be agreement that any protest should take place on Friday, after prayers. One man who had initially been agitating to take to the streets, announced he had had changed his position. “I’ve changed my mind, bro. The way I see, the brothers we can’t control.” Smaller discussions broke out in the crowd. After more debate, one man stepped forward and shouted with a force that lifted his voice above the murmurs. “Make sure you’re not marching in the name of the three brothers that died. Because if you’re gonna march … in their name, and you’re rioting, it is a disgrace.” There were grunts of approval. A number of people said they would go home. A handful of the masked youths walked away. Those who remained heard stood in near silence, heads bowed as they listened to Sikh and Muslim prayers. UK riots Birmingham Crime Paul Lewis Matthew Taylor Mustafa Khalili guardian.co.uk
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Pyongyang, accused of opening fire near disputed maritime line, blames skirmish on South’s ‘overreaction’ to construction noise North Korea has called South Korea’s claim of an artillery exchange between the rcountries “preposterous”, saying the South mistook construction noise for artillery when it accused Pyongyang of opening fire near the rivals’ disputed maritime line. North Korea said in a statement that the South overreacted to “normal blasting” from a North Korean construction project “aimed at improving the standard of people’s living”. South Korean defence officials say marines returned fire on Wednesday after North Korea launched artillery shells into the same waters that saw a deadly artillery exchange between the countries last November. “It was preposterous in the age of science when latest detecting and intelligence means are available that they mistook the blasting for shelling,” an unnamed North Korean representative to inter-Korean military talks said in a statement released by the official Korean Central News Agency. “It was a tragicomedy that they indiscriminately reacted to what happened with counter-shelling even without confirming the truth about the case in the sensitive waters.” South Korean defence ministry spokesman Kim Min-seok said three North Korean shells originally fired near the Northern Limit Line in the Yellow Sea prompted the South to fire back three shells. Another ministry official, who refused to be named because of office policy, said North Korea fired more rounds later in the day and that South Korea responded. All the shells landed in the water, South Korea said, and there were no reports of casualties. South Korean forces have been on high alert in the area since last November when a North Korean artillery attack killed four people, including two marines, on South Korea’s Yeonpyeong island. Wednesday’s artillery exchange took place nearby, South Korea said. It follows a recent easing of animosity between the Koreas and comes ahead of joint US-South Korean military drills set for next week. Last month, a senior North Korean diplomat met with US officials in New York to negotiate ways to restart long-stalled international talks aimed at persuading Pyongyang to abandon its aspirations concerning nuclear weapons. The meeting came after the Koreas’ nuclear envoys held cordial talks during a regional security forum in Indonesia. In its statement on Thursday, the North repeated its call for the cancellation of the US-South Korean drills and said South Korea was deliberately trying to ruin “the atmosphere of dialogue in the Korean peninsula”. On Wednesday, the US urged North Korea to exercise restraint and take steps to allow the six-nation disarmament talks to resume. “This incident is now over, and we now need to move back to the main business at hand,” state department spokeswoman Victoria Nuland told reporters in Washington. North Korea’s shelling took place unexpectedly, South Korean officials said, and neither side was conducting firing drills at the time. Violence often erupts in the contested slice of sea. Three deadly naval clashes since 1999 have claimed dozens of lives. Kim said one North Korean artillery shell is believed to have fallen south of the maritime line. The maritime line separating the countries was drawn by the US-led UN Command without Pyongyang’s consent at the close of the 1950-53 Korean war, which ended with a truce, not a peace treaty, leaving the peninsula still technically in a state of war. North Korea routinely argues that the line should run further south. Baek Seung-joo, a military analyst at the state-run Korea Institute for Defence Analyses in South Korea, said the North appears to be rattling its sabres ahead of the annual US-South Korean military exercises. On Monday a North Korean military spokesman released an open letter that called the joint exercises “hideous provocations”. He warned that Pyongyang had access to a “nuclear deterrent powerful enough to protect” itself. It has conducted two nuclear tests since 2006. North Korea South Korea guardian.co.uk
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Veteran chairman insists on ethics and integrity Rupert Murdoch pledged to do “whatever is necessary” to prevent a repeat of the phone-hacking scandal that led to the closure of his News of the World newspaper, thrown his succession plans into chaos and left his company facing decades of legal woes. “There can be no doubt about our commitment to ethics and integrity,” said the chairman of News Corp. “I have run this company for more than 50 years,” Murdoch added as he announced strong results for his media empire. “The kind of behaviour that occurred in that newsroom has no place at News Corporation. It does not reflect the actions and beliefs of our more than 50,000 professional employees. I am personally determined to put things right when it comes to News of the World.” Murdoch’s comments came as News Corp announced a full-year operating income of $4.98bn (£3.08bn), compared with $4.46bn reported a year ago – a 12% increase driven in large part by the success of his television and cable network programming. The company reported a 22% drop in fourth-quarter earnings because of losses from the sale of its struggling social network Myspace. It made a $254m after-tax loss from the sale of Myspace. But strong results from its television assets, including the Fox TV network, beat analysts’ estimates. Its net income fell to $683m, or 26 cents a share, down from $875m, or 33 cents a share, a year ago. Revenue rose 11% to $8.96 bn, helped by advertising sales and fees at Fox TV and its cable networks. Operating income at its cable network unit rose 12%, helped by a 23% rise in advertising revenue at its domestic channels and a 30% rise in affiliate fees at its international cable channels. Advertising at its Fox broadcast business also rose by 7%. Film profits rose 53% thanks to animation hit Rio, and home entertainment sales of Black Swan and The Chronicles of Narnia. This was the first results presentation that Murdoch has hosted for nearly a year and the first since his appearance before the parliamentary committee investigating the hacking scandal. He said the company did not yet have any idea what the financial bill to News Corp could be from potential legal action and fines. He said the company needed to “get to the bottom” of what happened: “Were there a dozen guilty people or two dozen?” Murdoch said: “While it has been a good quarter from a financial point of view, our company has faced challenges in recent weeks relating to our London tabloid, News of the World. We are acting decisively in the matter and will do whatever is necessary to prevent something like this from ever occurring again.” News Corp closed the News of the World last month as the revelations that its journalists had hacked into people’s phones, including the murdered teenager Milly Dowler, led to public outrage, a parliamentary inquiry at Westminster triggered a US investigation of possible abuses under US law. “It is important to note that there has been no material impact on our other operations,” he said. “Our broad, diverse group of businesses across the globe is extremely strong today. The drivers of our businesses are intact, our position is strong and our future is promising. “Our fundamental goals at News Corp are to produce sustained, meaningful value for shareholders, provide outstanding content and services to customers and consumers – and do it with integrity. These goals are interrelated and all three are critically important. And we will deliver.” Murdoch said he and Chase Carey, News Corp’s chief operating officer, had “full confidence” in James Murdoch, long seen as Murdoch’s heir apparent. James Murdoch is facing allegations that he mislead the parliamentary select committee. Murdoch also dismissed allegations that his independent board of directors was not independent. “That’s not true,” he said. Murdoch said the company had retained outside advice and evaluated its corporate governance practices and found no flaws. The News Corp boss, and largest shareholder, said he was disappointed that he had had to scrap plans for a full-takeover of satellite broadcaster BSkyB. News Corporation Media business News International Newspapers & magazines Newspapers Phone hacking BSkyB BSkyB Rupert Murdoch Dominic Rushe guardian.co.uk
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Ladybird spider to be released into new areas by conservationists The UK’s rarest spider is to be safeguarded from extinction by conservationists releasing the species in a new home in Dorset – using plastic water bottles. The ladybird spider – Eresus sandaliatus – is one of the most colourful arachnids in Britain, but by the 1990s only 56 were left. There are now more than a thousand, thanks to the efforts of conservationists, and the spider is ready to be released into new areas. The first of these introductions begins on Thursday with the release of 30 ladybird spiders into the RSPB’s Arne reserve in Dorset. They will be monitored in their new home and, if successful, more will be released in the next few years. Toby Branston, the RSPB’s senior warden at Arne, said: “The hope is that this will establish a self-sustaining population here so that if one of the other satellite populations gets damaged by fire, for example, then the species will not become extinct in the UK … It will be safeguarding the species in Britain.” Wildfires in May hit heathland in parts of the Scottish Highlands, Ireland, north-west England and Berkshire with devastating results for wildlife , though the spider’s current home elsewhere in Dorset was unaffected. The spiders will be taken to their new home in plastic water bottles, each filled with heather and moss. Then the bottles will be buried to allow the spiders to crawl out in their own time. “Burying plastic bottles in the heathland may seem a little strange to some of our visitors, but the experts have found that this is the best way to translocate the spiders,” said Branston. “This is an ideal habitat for them so we will be keeping a close eye on the new colony and carrying out regular surveys to see if they take to their new home.” Scientists had believed that the ladybird spider was extinct in the UK, but in the 1980s one small colony was found in Dorset. The species was deeply affected as its heathland habitat was disappearing, being lost to farming, forestry and housing. The Arne nature reserve – the spiders’ new home – is an insect hotspot that covers a range of habitats. It already has 240 spider and hundreds of insect species, including a subspecies of the rare silver-studded blue butterfly and the Purbeck mason wasp (which even appears on a set of stamps of endangered British insects issued by Royal Mail in 2008). It is the mature male ladybird spiders that have the bright red bodies covered in small black spots, which give the species its name. The females – with body lengths between 10 and 16mm, almost twice that of the colourful males – and juveniles are a velvety black. Ladybird spiders live in a hole in the ground, a tube which they line with silk and decorate with the remains of their prey, often beetles. The females rarely leave their burrows and both sexes feed off insects that become entangled in the fine strands of web at the hole’s entrance. Insects Conservation Endangered species Biodiversity RSPB Endangered habitats Wildlife Animals guardian.co.uk
Continue reading …AP’s Wis. Recall Coverage Desperately Seeks Silver Lining, Ignores Next Week’s Dem Recalls
August 10, 2011 No CommentWednesday evening, the Associated Press's Sam Hananel, with predictable help from Scott Bauer, tried to do a Bing Crosby imitation (“Unions look for silver lining in Wisconsin recalls”) in an attempt to ” Accentuate the Positive ” in reporting on the results of yesterday's attempts to defeat six Republican Badger State Senators in recall elections. Democrats, leftists, and public-sector unions needed to win three of the six races to tentatively and perhaps only temporarily regain a State Senate majority. They only got two, putting the GOP's temporary majority at 17-16. Temporary? Oh, Hananel “somehow” forgot to tell readers that two electoral attempts to replace Democratic State Senators are taking place next week, and that their retention of those positions is by no means assured. Here are several paragraphs from Hananel's report (“Accentuate the [false] Positive” items are in bold): Labor officials said Wednesday that the results in Wisconsin's unprecedented recall elections should send a stern warning to any elected official who might seek to curb collective bargaining rights. But in toppling only two of the six lawmakers they targeted, some observers said the outcome could be a sign that labor's political clout isn't what it used to be. Unions celebrated the ouster of two Republican state senators who supported Gov. Scott Walker's bill to curb collective bargaining rights for most state employees. Despite the historic wins for Wisconsin Democrats in Tuesday's voting, they still fell short of their goal to knock off at least three Republicans so they could take majority control of the state Senate and be able to block Walker and the Republicans' conservative agenda. … “Organized labor certainly didn't lose any ground,” (Democratic political strategist Doug) Schoen said. “They didn't fundamentally alter the political environment, but they sent a strong message to Republicans that what they are doing is not without peril.” That's the silver lining union officials were spinning Wednesday. “This is going to send a signal that workers and the public are not going to take this overreaching lying down,” AFL-CIO political director Mike Podhorzer said. “I can't imagine that if I were a state legislator in another state that I would want to go through what these six Republicans just went through.” Unions plan to take the fight to Ohio, where voters will decide in November whether to repeal the state's new collective bargaining law. A spokesman for a group that wants to keep the law in place called the two election wins in Wisconsin “meaningless.” “Labor got into this with the goal of shifting the balance of power and they failed,” said Jason Mauk, spokesman for Building a Better Ohio, a group defending the new law. “There's no other way to read it. They spent millions of dollars in hopes of sending a message and it fell flat.” Here's a memo to the AFL-CIO's Podhorzer: Two Democrat state senators are going through the same thing you “can't imagine” in your very own state next week. Here's how Wisconsin-based blogger Steve Eggleston of No Runny Eggs assessed yesterday's results in an email to yours truly, and his take on what he knows about the two elections next Tuesday: I honestly wasn’t surprised at either of the two (Republican) losses, or that it was only 2. While Dan Kapanke is a good guy, he is in a D district. While Randy Hopper’s district is, in normal circumstances, a “safe” R, he has personal issues (cough…extramarital affair…cough) and outside the Dane County (Madison) districts, he had the highest percentage of state workers thanks to several prisons in the district. I don’t have any polling, much less solid, but (next week) the Rs should get at least Jim Holperin’s seat – the district is about as much R as Kapanke’s is D. I honestly don’t have any feel for the Robert Wirch seat. So one of the “R's” arguably deserved to be thrown out yesterday anyway, and a GOP pickup of one of the two seats next week is looking at least somewhat likely. One would think that the two GOP challengers and everyone helping them have been buoyed by yesterday's results and are even more motivated to finish strong. Hananel's writeup reminds me of what Mark Steyn wrote after the closely-watched Paul Hackett vs. Jean Schmidt 2005 special congressional election in Southwestern Ohio. In that race, seen nationally as a mini-referendum on the popularity of the Iraq War, Operation Iraqi Freedom vet and Democrat Hackett attempted to pretend in the district's TV ads that he was a supporter of George W. Bush and the war, while telling the rest of the nation , particularly the nutroots, that Bush was a “son of a b****” and a “chickenhawk.” Schmidt won narrowly , and Democrats tried to go into “We lost, but we sent a message” mode. Steyn was having none of it: It was “nearly the biggest political upset in recent history,” which is another way of saying it was actually the smallest political non-upset in recent history. Exactly the same thing can be said of Wisconsin's recall efforts — and, contrary to Sam Hananel's non-mention, it isn't over yet. By next Tuesday night, the party makeup of the Wisconsin Senate could be only one seat different than it was previously, and might conceivably end up the same. The Buckeye State election discussed in the final two excerpted paragraphs is certainly up for grabs, but anyone on the left who thinks what happened in Wisconsin represents any kind of momentum coming into that election is in deep denial. By the tone of what Hananel wrote, it's not unreasonable to predict that the AP will treat next week's Wisconsin elections next week as a non-national story — because, you see, Democrats ousting Republicans is news, but Republicans returning the favor isn't. Prove me wrong, Sam and Scott. Cross-posted at BizzyBlog.com .
Continue reading …Things are getting funky out there, with very big (big like the solar system big) changes in store for us. Five years from now, this country, and the world economic order, are going to be fundamentally changed from what they are today. We don’t yet know how, but we are without a doubt in what I called in my book on American history a Big Change Moment. But before I go there, let me start with a word about our politics and how political dynamics will impact our Big Change Moment. In politics, most things are unpredictable and highly variable (especially in wild times like these), but there are at least a couple of things that are truisms. They are what I’d call the two destinies: demographics is destiny, and economics is destiny. On the demographics side of things, the campaign most likely to win is the one whose base voters are fired up to turn out to vote, and fired up to go out and persuade the swing voters. Looking at the demographic differences between the 2008 electorate and the 2010 electorate is a classic case in point. In 2008, the electorate was proportionally far younger, far less white, and far less married than they were in 2010. Young people, people of color, and unmarried people are far more likely than older, whiter, married people to vote Democratic. Guess who won in 2008, and who won in 2010? If demographics is destiny, economics is doubly so. The party in the White House never does well unless the economy is either good or is clearly getting better from a previous low point (the only two incumbents in the last 100-plus years to win re-election in a weak economy were FDR and Harry Truman, who incidentally ran classic fighting populist campaigns). We are now on the brink of true economic crisis, with markets on the verge of melting down and Europe teetering on the edge of leading the world into an economic panic, but even if policymakers control the short-term damage and reassure the markets in the short term, the best case scenario right now is that the American economy will still be pretty close to dead in the water deep into next year. That means that President Obama has to make a choice in terms of how he runs his campaign next year. One idea is to make the case that he is a reasonable centrist by being willing to cut lots of spending, meet the Republicans in “the middle” on a variety of issues, make the case that the economy is making progress/isn’t as bad as it seems and would have been a lot worse absent Obama policies, and then to focus on “winning the future.” The strategic focus would be to emphasize the choice between Obama and the far right philosophy of the modern Republican Party, tying whoever the Republican nominee is closely to Republicans in the House. Given the nuttiness of the Republican primary electorate, and the length their candidates will have to go in the Presidential primary to satisfy their base, whoever survives that process should look pretty extreme to moderate voters, so making this a choice between Obama and the Republican (as opposed to the election being a referendum on Obama) is critically important. In general, this tactical approach, with its carefully drawn traditional centrism, is clearly what the D.C. conventional wisdom crowd is advising Obama to do, and it would be a respectable strategy in a normal political year and/or where the economy was showing any signs of progress at all. But in a year where people are feeling worse about the economy than they were four years ago, this within-the-usual-lines strategy seems fundamentally wrong to me. The one part of it that definitely makes sense is making the election a choice, not a referendum, but I am convinced that the choice needs to be drawn differently. The second choice is to show that you are fighting for the middle class by taking the steps you can take as President to stand up for them (and against the special interests crushing them), clearly contrast yourself with right wing Republican ideology by picking clear fights with them that unify your political coalition, and to lay out a bold new economic program that takes goes to the core of the crises besetting the economy right now. Stan Greenberg has outlined and thoroughly tested a message framework that moves significant numbers in the Democratic direction with a message that strongly takes on wealthy special interests on behalf of the middle class in big economic fights, and it is a message that works far better than the message I mentioned in the paragraph above, but this is also far more than just framing. The President has to show himself thoroughly on the side of working families, middle-class voters, and people struggling in this economy by taking their side in tangible fights on their behalf. The President is far more than Legislator-in-Chief, and he needs to be very visible in boldly using the power of the executive branch in these fights. The executive branch is, in fact, far from helpless in terms of pursuing specific economic policies and regulations that would help spur economic growth. A great example is something they already did that got little coverage because of the default crisis: new Treasury regulations that helped unemployed homeowners slow the banks down in foreclosure fights. More regulations could be created to help homeowners out in their battles with the bankers, and more pressure on the big banks could be brought to bear in general by Treasury and other agencies to push them to do many more mortgage writedowns, which could put hundreds of dollars a month into the pockets of millions of middle class homeowners. Fannie and Freddie, which are controlled by the federal government, could be far more helpful in terms of those kinds of mortgage writedowns as well, and in general could be doing several different things to help stabilize the housing market. As with the new Treasury regulations to help unemployed homeowners, my point is proved by something Fannie and Freddie just did, adapting a new policy pushed by Jared Bernstein to take foreclosed properties off the market and turn them into rentals. There are all kinds of things the administration can do to help the housing market without needing new legislation, and everything they do in that regard is a huge boost to the overall economy. Another thing they could do, as I and others have written about before, is to use the remaining money authorized in TARP to invest in businesses that want to hire new workers. There’s $475 billion sitting in that authorization that they could tap into, and given the desperate need for jobs, that is exactly what they should do. TARP is a very unpopular program, but it would become a lot more popular very quickly if it started investing in jobs rather than bailing out big banks. Finally, they could do a lot more with executive orders to start promoting not only jobs, but good jobs. Many Presidents, from FDR to LBJ to Nixon and Reagan, made far more aggressive use of executive orders to promote their economic agenda, and using this power when Congress won’t help revive the economy is exactly what they ought to be doing. The best example I know of is a series of executive orders promised to labor unions during the 2008 campaign that would use the federal government’s procurement power to actually promote good paying jobs in a variety of different areas from food purchasing to manufacturing military goods to trucking and transportation. These executive orders have been developed and never acted on, and would help promote middle-class wages for middle-class jobs. In clear, strong populist messaging and in concrete action by the executive branch, the Obama administration has a chance to show they are on the side of middle-class families, and those young and poor people trying to gain a foothold to climb the ladder into the middle class. With the economy in bad shape, this is not a tactical election where nuanced positioning to show yourself to be a classical centrist is going to carry the day. The President has to be forcefully advocating that in these troubled times, he understands what people are going through, and is thoroughly on their side fighting for them. Which brings me back to where I started this article: We are in a defining historical moment, when an economic crisis of historical proportions is forcing a big choice. Either the big banks and other economic elites are going to kill the middle class and the safety net for the poor and elderly in their efforts to save themselves from their own excess, or we are going to wrest power from them and rebuild our economy from the bottom up. My belief is that there is no in-between; this will go either one way or another within the next five years. With the economy forcing that kind of fundamental choice, things will look strikingly different when we get through this transition. Let’s hope the people win, not the banks.
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Britain’s fragile recovery is being plagued by high inflation, low interest rates and mayhem in the world’s financial markets Sir Mervyn King warned that the headwinds facing Britain’s fragile economic recovery were becoming “stronger by the day”, as the Bank of England cut its growth forecasts. City analysts predicted that interest rates would remain at their record low of 0.5% until 2013, after the governor used his quarterly inflation report briefing to warn that the UK could not be isolated from the turmoil in the global economy. As George Osborne, the chancellor, prepared to address the House of Commons on Thursday on the risks for the UK from the mayhem in world financial markets, the Bank’s nine-member monetary policy committee (MPC) downgraded its growth forecast to about 1.5% this year. That was down from 1.8% in its last report three months ago, and weaker than the 1.7% pencilled in by the Office for Budget Responsibility. King warned that the Bank’s number-crunchers had not included in their forecasts what he called “the unimaginable and the unmentionable” – risks impossible to quantify, such as a full-blown sovereign debt crisis in the eurozone. “It is very important that we do not see the development of a sovereign debt crisis.” For 2012, the Bank is now projecting growth of about 2%, against the OBR’s 2.5%. It expects cash-strapped consumers, hit by tax rises and rapid increases in the cost of living, to continue tightening their belts. “The squeeze in households’ real incomes is likely to continue to weigh on domestic demand, especially over the next year or so,” the MPC said in the report. “But expansionary monetary policy, prospective growth in global demand and the current level of sterling should mean that, after some near-term weakness, GDP growth picks up.” King said that the drama in the markets reflected the fact that the imbalances built up in the global economy during the boom years had still not been resolved, and the Bank would be unable to cushion the UK from the fallout. “There’s a limit to what monetary policy can do,” he said. “There are significant adjustments that need to be made.” The governor made clear that a fresh round of “quantitative easing” – the injection of electronically created money into the economy – remains an option if the situation deteriorated further. Peter Dixon, UK economist at Commerzbank, said, “unsurprisingly, Sir Mervyn King maintained his long-standing view that the BoE still had some shots in its locker, including more asset purchases if necessary.” The governor rejected the idea that the Bank could follow the US Federal Reserve and make a long-term commitment to keep interest rates at current levels, however. In a bid to calm chaotic financial markets, the Fed suggested on Tuesday that borrowing costs would remain at their current exceptionally low levels until 2013. But King argued: “I think it’s very dangerous to try to make a commitment. To lock in monetary policy now for two years does not seem to me to be particularly sensible.” He added that financial markets in Britain already expected interest rates to be held for the foreseeable future. George Buckley, chief UK economist at Deutsche Bank, noted that the Bank’s forecasts suggested that without fresh monetary stimulus, such as a new round of quantitative easing, inflation would be below the MPC’s 2% target in two years. “The Bank’s signalling may be less obvious than that of the Fed, but in its own way it is telling us that rates are likely to remain low for a long period,” added Buckley. After King’s bearish assessment, RBS joined other City banks in forecasting that there would be no rise in interest rates until 2013 at the earliest. The MPC expects inflation to peak later this year at about 5%, driven by soaring utilities bills, but to fall rapidly in 2012, as the effect of oil price rises and the VAT increase wear off. The MPC’s analysis suggested the deep recession that followed the credit crunch has left lasting scars on the economy. “Output is likely to remain significantly below its pre-recession trend,” it said, warning that even by 2014, GDP growth is only, “a little more likely to be above its historical average than below it”. Brendan Barber, TUC general secretary, said: “This recovery is already the slowest on record, and the Bank’s assessment that it may take another three years for us just to recover lost ground shows that the pain is set to continue for some time.” King said it was far too soon to say whether there was any connection between economic weakness and the riots. He stressed that the private sector had created many more jobs than had been lost through public-sector cuts over the past 12 months. ‘The unimaginable and the unmentionable’ The risks too scary for the Bank of England to calculate: Eurozone break-up As the continued sell-off in European markets makes clear, the future of the single currency looks alarmingly uncertain. Perhaps hard-hit Greece will decide it’s had enough and leave – or maybe the entire 17-member bloc will be blown apart. Middle East conflagration A worst-case scenario has the stand-off in Libya and the Syrian unrest spiral into a much wider conflict, sending world oil prices rocketing. 1930s-style protectionism As Mervyn King said, creditors and debtors – east and west, China and the US – still have to work out how to share losses from the financial crisis. The pain could be evenly shared or end in a tit-for-tat trade war, with everyone worse off. Military conflict The world economy is already perilously weak, and confidence is in tatters. Any sabre-rattling, from North Korea to the Caucasus, could be shattering. Bank of England Mervyn King Economic growth (GDP) Economics Interest rates US Interest rates Inflation Global economy Stock markets Euro Heather Stewart guardian.co.uk
Continue reading …Britain’s fragile recovery is being plagued by high inflation, low interest rates and mayhem in the world’s financial markets Sir Mervyn King warned that the headwinds facing Britain’s fragile economic recovery were becoming “stronger by the day”, as the Bank of England cut its growth forecasts. City analysts predicted that interest rates would remain at their record low of 0.5% until 2013, after the governor used his quarterly inflation report briefing to warn that the UK could not be isolated from the turmoil in the global economy. As George Osborne, the chancellor, prepared to address the House of Commons on Thursday on the risks for the UK from the mayhem in world financial markets, the Bank’s nine-member monetary policy committee (MPC) downgraded its growth forecast to about 1.5% this year. That was down from 1.8% in its last report three months ago, and weaker than the 1.7% pencilled in by the Office for Budget Responsibility. King warned that the Bank’s number-crunchers had not included in their forecasts what he called “the unimaginable and the unmentionable” – risks impossible to quantify, such as a full-blown sovereign debt crisis in the eurozone. “It is very important that we do not see the development of a sovereign debt crisis.” For 2012, the Bank is now projecting growth of about 2%, against the OBR’s 2.5%. It expects cash-strapped consumers, hit by tax rises and rapid increases in the cost of living, to continue tightening their belts. “The squeeze in households’ real incomes is likely to continue to weigh on domestic demand, especially over the next year or so,” the MPC said in the report. “But expansionary monetary policy, prospective growth in global demand and the current level of sterling should mean that, after some near-term weakness, GDP growth picks up.” King said that the drama in the markets reflected the fact that the imbalances built up in the global economy during the boom years had still not been resolved, and the Bank would be unable to cushion the UK from the fallout. “There’s a limit to what monetary policy can do,” he said. “There are significant adjustments that need to be made.” The governor made clear that a fresh round of “quantitative easing” – the injection of electronically created money into the economy – remains an option if the situation deteriorated further. Peter Dixon, UK economist at Commerzbank, said, “unsurprisingly, Sir Mervyn King maintained his long-standing view that the BoE still had some shots in its locker, including more asset purchases if necessary.” The governor rejected the idea that the Bank could follow the US Federal Reserve and make a long-term commitment to keep interest rates at current levels, however. In a bid to calm chaotic financial markets, the Fed suggested on Tuesday that borrowing costs would remain at their current exceptionally low levels until 2013. But King argued: “I think it’s very dangerous to try to make a commitment. To lock in monetary policy now for two years does not seem to me to be particularly sensible.” He added that financial markets in Britain already expected interest rates to be held for the foreseeable future. George Buckley, chief UK economist at Deutsche Bank, noted that the Bank’s forecasts suggested that without fresh monetary stimulus, such as a new round of quantitative easing, inflation would be below the MPC’s 2% target in two years. “The Bank’s signalling may be less obvious than that of the Fed, but in its own way it is telling us that rates are likely to remain low for a long period,” added Buckley. After King’s bearish assessment, RBS joined other City banks in forecasting that there would be no rise in interest rates until 2013 at the earliest. The MPC expects inflation to peak later this year at about 5%, driven by soaring utilities bills, but to fall rapidly in 2012, as the effect of oil price rises and the VAT increase wear off. The MPC’s analysis suggested the deep recession that followed the credit crunch has left lasting scars on the economy. “Output is likely to remain significantly below its pre-recession trend,” it said, warning that even by 2014, GDP growth is only, “a little more likely to be above its historical average than below it”. Brendan Barber, TUC general secretary, said: “This recovery is already the slowest on record, and the Bank’s assessment that it may take another three years for us just to recover lost ground shows that the pain is set to continue for some time.” King said it was far too soon to say whether there was any connection between economic weakness and the riots. He stressed that the private sector had created many more jobs than had been lost through public-sector cuts over the past 12 months. ‘The unimaginable and the unmentionable’ The risks too scary for the Bank of England to calculate: Eurozone break-up As the continued sell-off in European markets makes clear, the future of the single currency looks alarmingly uncertain. Perhaps hard-hit Greece will decide it’s had enough and leave – or maybe the entire 17-member bloc will be blown apart. Middle East conflagration A worst-case scenario has the stand-off in Libya and the Syrian unrest spiral into a much wider conflict, sending world oil prices rocketing. 1930s-style protectionism As Mervyn King said, creditors and debtors – east and west, China and the US – still have to work out how to share losses from the financial crisis. The pain could be evenly shared or end in a tit-for-tat trade war, with everyone worse off. Military conflict The world economy is already perilously weak, and confidence is in tatters. Any sabre-rattling, from North Korea to the Caucasus, could be shattering. Bank of England Mervyn King Economic growth (GDP) Economics Interest rates US Interest rates Inflation Global economy Stock markets Euro Heather Stewart guardian.co.uk
Continue reading …Britain’s fragile recovery is being plagued by high inflation, low interest rates and mayhem in the world’s financial markets Sir Mervyn King warned that the headwinds facing Britain’s fragile economic recovery were becoming “stronger by the day”, as the Bank of England cut its growth forecasts. City analysts predicted that interest rates would remain at their record low of 0.5% until 2013, after the governor used his quarterly inflation report briefing to warn that the UK could not be isolated from the turmoil in the global economy. As George Osborne, the chancellor, prepared to address the House of Commons on Thursday on the risks for the UK from the mayhem in world financial markets, the Bank’s nine-member monetary policy committee (MPC) downgraded its growth forecast to about 1.5% this year. That was down from 1.8% in its last report three months ago, and weaker than the 1.7% pencilled in by the Office for Budget Responsibility. King warned that the Bank’s number-crunchers had not included in their forecasts what he called “the unimaginable and the unmentionable” – risks impossible to quantify, such as a full-blown sovereign debt crisis in the eurozone. “It is very important that we do not see the development of a sovereign debt crisis.” For 2012, the Bank is now projecting growth of about 2%, against the OBR’s 2.5%. It expects cash-strapped consumers, hit by tax rises and rapid increases in the cost of living, to continue tightening their belts. “The squeeze in households’ real incomes is likely to continue to weigh on domestic demand, especially over the next year or so,” the MPC said in the report. “But expansionary monetary policy, prospective growth in global demand and the current level of sterling should mean that, after some near-term weakness, GDP growth picks up.” King said that the drama in the markets reflected the fact that the imbalances built up in the global economy during the boom years had still not been resolved, and the Bank would be unable to cushion the UK from the fallout. “There’s a limit to what monetary policy can do,” he said. “There are significant adjustments that need to be made.” The governor made clear that a fresh round of “quantitative easing” – the injection of electronically created money into the economy – remains an option if the situation deteriorated further. Peter Dixon, UK economist at Commerzbank, said, “unsurprisingly, Sir Mervyn King maintained his long-standing view that the BoE still had some shots in its locker, including more asset purchases if necessary.” The governor rejected the idea that the Bank could follow the US Federal Reserve and make a long-term commitment to keep interest rates at current levels, however. In a bid to calm chaotic financial markets, the Fed suggested on Tuesday that borrowing costs would remain at their current exceptionally low levels until 2013. But King argued: “I think it’s very dangerous to try to make a commitment. To lock in monetary policy now for two years does not seem to me to be particularly sensible.” He added that financial markets in Britain already expected interest rates to be held for the foreseeable future. George Buckley, chief UK economist at Deutsche Bank, noted that the Bank’s forecasts suggested that without fresh monetary stimulus, such as a new round of quantitative easing, inflation would be below the MPC’s 2% target in two years. “The Bank’s signalling may be less obvious than that of the Fed, but in its own way it is telling us that rates are likely to remain low for a long period,” added Buckley. After King’s bearish assessment, RBS joined other City banks in forecasting that there would be no rise in interest rates until 2013 at the earliest. The MPC expects inflation to peak later this year at about 5%, driven by soaring utilities bills, but to fall rapidly in 2012, as the effect of oil price rises and the VAT increase wear off. The MPC’s analysis suggested the deep recession that followed the credit crunch has left lasting scars on the economy. “Output is likely to remain significantly below its pre-recession trend,” it said, warning that even by 2014, GDP growth is only, “a little more likely to be above its historical average than below it”. Brendan Barber, TUC general secretary, said: “This recovery is already the slowest on record, and the Bank’s assessment that it may take another three years for us just to recover lost ground shows that the pain is set to continue for some time.” King said it was far too soon to say whether there was any connection between economic weakness and the riots. He stressed that the private sector had created many more jobs than had been lost through public-sector cuts over the past 12 months. ‘The unimaginable and the unmentionable’ The risks too scary for the Bank of England to calculate: Eurozone break-up As the continued sell-off in European markets makes clear, the future of the single currency looks alarmingly uncertain. Perhaps hard-hit Greece will decide it’s had enough and leave – or maybe the entire 17-member bloc will be blown apart. Middle East conflagration A worst-case scenario has the stand-off in Libya and the Syrian unrest spiral into a much wider conflict, sending world oil prices rocketing. 1930s-style protectionism As Mervyn King said, creditors and debtors – east and west, China and the US – still have to work out how to share losses from the financial crisis. The pain could be evenly shared or end in a tit-for-tat trade war, with everyone worse off. Military conflict The world economy is already perilously weak, and confidence is in tatters. Any sabre-rattling, from North Korea to the Caucasus, could be shattering. Bank of England Mervyn King Economic growth (GDP) Economics Interest rates US Interest rates Inflation Global economy Stock markets Euro Heather Stewart guardian.co.uk
Continue reading …On Monday, when the stock market lost over 600 points after the S&P downgrade, which was obviously going to happen, Fox News went ballistic. Of course. But when the markets rallied the following day, Beckel wondered why that was ignored by the producers on the set of The Five . Wingnut Judge Napolitano had these words for Bob: Bob, it’s not good to attack the producers. He knows they won’t boot him unless he mutters a couple of George Carlin’s seven dirty words . Remember, he likes the flat tax . I’m sure Fox News will go ballistic again today as the market opens down .
Continue reading …