Community spirit shines through in Japan's dark times

3/26/2011

The village of Odachi, just outside Ofunato in Iwate prefecture, is like so many others along Japan's coast.

Homes splintered, lives destroyed.
When the tsunami thundered in, it swept right up the little valley the community nestles in, between the cedar-fringed hills.
Buildings were flung about, and came to rest at the high-water mark.
Shuichi Shida was luckier than most. His family survived and he even remembered the dog when he ran to safety.
His house stood while those around it were destroyed.
But the wave smashed right through, even upstairs. His home will probably have to be knocked down.
"It's been nearly two weeks since the tsunami," he says. "I still have no idea what to do."
Japan's government has marshalled its military in a massive aid operation, but the people are also trying to help themselves.
'Close relationships'
Every mealtime in Odachi, the survivors head up to the three houses belonging to the extended Kino family, at the top of the hill.
Much of the village is living there now.

They have set up a communal kitchen in the garden, using blue tarpaulins to screen off an area.

The cooking is done on open fires, which have big pots of water boiling on them all day.
The men, filthy from scavenging for belongings in the ruins, sit for a smoke and a chat, while the women prepare miso soup with vegetables, hard-boiled eggs and seaweed for dinner.
The children play football.
Adversity has brought people together.
Inside the Kinos' homes, futons have been laid out on the floor, so everyone has somewhere to sleep.
The only lighting is from candles because there is no electricity. A wind-up radio is on to hear the latest news.
There is no privacy, but no-one is complaining.
Wreckage cleared "My family and I don't have any problem with this," says Makiko Kino, mother to three small boys. "It's the opposite in fact and I am rather enjoying this. There are so many children around it's a lot of fun.
"It's the countryside here. We have a close relationship with our neighbours. We have known each other for so long it is not an issue."

The village has been given tents by a British charity, Shelterbox.
The idea is that everyone will have more space.
The villagers cleared the wreckage from a field to pitch them side by side.
"If I'd been alone it would have been very difficult to stand," says Shuichi Shida. "But all of the neighbours have combined our resources.
"We've worked together, to make a bath, put up tents, chop wood for fuel. We co-operate and we even manage to laugh."
There is no hurry to move out of the Kinos' houses where everyone has been sleeping.
Japan has never lost its sense of community and in dark times it is shining through.
This nation's great disaster has brought out the best in its people.

David Cameron wants Japan EU trade deal

The European Union (EU) should offer Japan a free trade deal to help it recover from the earthquake and tsunami two weeks ago, UK Prime Minister David Cameron has said.

"One of our priorities must be to invite Japan to enter into a free trade area with the EU," Mr Cameron said.
This would give Japan a trade boost and aid its economic recovery, he said following an EU summit in Brussels.
The Japanese government has estimated the rebuilding cost to be £192bn.
Mr Cameron said he had "secured a specific reference" to his proposal in the conclusions of EU documents.
The documents will be published later.
Manageable costs Earlier, the International Monetary Fund said it believed Japan's economy was strong enough to afford the cost of rebuilding the damage from the earthquake and tsunami.
It said it expected a short-term drop in the economy, but no long-term impact.
"Despite the extensive damage we are of the view that the economic costs are manageable," said Ken Kang, the IMF's Asia Pacific chief.
However, it said that power shutdowns would complicate Japan's prospects.

Moody's Lowers Egypt's Credit Rating

3/16/2011

(RTTNews) - Moody's Investors Service on Wednesday downgraded Egypt's foreign and local currency government bond ratings by one notch to Ba3 from Ba2, citing continued volatility in the country's domestic politics.
This is the second rating downgrade this year following a cut to Ba2 from Ba1 on January 31.
The rating agency said the prospect for Egypt's economic recovery is uncertain and the political uncertainty is having an adverse impact on the country's fiscal position and broader economic performance.
The negative outlook on the rating is maintained given the uncertainty of the political outlook and the resulting downside risks to the country's credit fundamentals.
The rating agency warned that it would consider downgrading Egypt's bond ratings further in the event of a substantial fall in foreign exchange reserves, signs that the government were facing difficulty in funding its wide fiscal deficit, or a political deterioration that threatened the transition to an effective government.

Norwegian Central Bank Retains Key Interest Rate

 
(RTTNews) - Norway's central bank on Wednesday decided to retain the key policy rate at 2 percent for a seventh straight rate-setting session. But it signaled a rate hike is likely in the coming months.
In a statement, the central bank said the upturn in the Norwegian economy has gained a firm footing.
"The Executive Board's current assessment is that the key policy rate should be increased before the end of the first half-year of 2011," the Norges Bank said.
The central bank said inflation will remain low in the coming quarters and gradually pick up towards the target of 2.5 percent. In February, consumer price inflation slowed to 1.2 percent from 2 percent in January.
The executive board sees prospects for fairly strong growth in the Norwegian economy in the years ahead, driven by solid income growth, rising investment and high population growth.
"Should economic activity or inflation rise more than expected, the increase in the key policy rate may be more pronounced than currently envisaged," Norges Bank Deputy Governor Jan Qvigstad said.
"In the event of a marked slowdown in world economic growth, heightened financial turbulence abroad or a further appreciation of the krone, the increase in the key policy rate could be deferred further ahead."
Qvigstad said the central bank's latest assessment implies that the interest rate should gradually be raised towards a more normal level.

U.S. Business Sales Surge Higher In January, Inventories Rise 0.9%

3/11/2011

(RTTNews) - Business inventories in the U.S. increased by slightly more than economists had predicted in January, according to figures released by the Commerce Department on Friday, while sales continued to surge higher.
Manufacturers' and trade inventories, seasonally adjusted, were estimated at $1.4531 trillion, up 0.9 percent from December. Economists had forecast an increase of 0.8 percent.
Additionally, the initial estimate of growth in inventories in December was upwardly revised to 1.1 percent from 0.8 percent.
Total business sales also continued to accelerate, jumping 2.0 percent in January to a level of $1.178 trillion, the highest total sales level since August 2008. Sales increased by 1.6 percent in December.
The increase in sales was driven by a strong showing among merchant wholesalers, who saw a 3.4 percent increase in sales.
Manufacturers also saw a 1.8 percent increase in sales, though that reflected a slowdown from the 2.7 percent increase recorded in December.
Retailers' sales continued to increase steadily in January, rising 0.8 percent compared to the 0.7 percent increase in December.
Manufacturers' inventories showed the largest increase, rising 1.3 percent, while wholesale inventories rose by 1.1 percent.
Retail inventories rose 0.4 percent, although automobiles and parts played only a small part in the increase, rising just 0.1 percent.
The total inventories/sales ratio in January was 1.23, down from the 1.25 ratio recorded in December.
Both sales and inventories were markedly higher from last year, with sales up 10.8 percent from January 2010 and inventories up 9.1 percent.

Iceland Jobless Rate Continues To Rise In February

RTTNews) - Unemployment rate in Iceland increased for a fifth consecutive month in February, data from the Directorate of Labor showed Friday.
The jobless rate increased to 8.6 percent in February from 8.5 percent in January. This was the highest rate in ten months, data showed.
During the month, there were 13,772 unemployed persons in the country, 314 more than in January. Unemployment edged up 0.1 percent month-on-month.
The number of job vacancies increased to 198 in February from 185 during the previous month. The Directorate expects unemployment to increase marginally over the month and forecasts the jobless rate to be between 8.5 percent and 8.8 percent in March.

Cong presses for CBI probe into Orissa Dal Scam

NEW DELHI: The Congress today stepped up pressure for a CBI probe into the multi-crore dal scam in Orissa, which has already led to the ouster of a Minister from the BJD government.

Party leader and Rajya Sabha MP from the State Rama Chandra Khuntia met Prime Minister Manmohan Singh and submitted a memorandum demanding a CBI probe into the scam.

He also gave a memorandum to AICC President Sonia Gandhi .

In a statement, he alleged that with high officials and the minister involved in the scam, "the state vigilance may not have enough courage to give a report which may go against the Orissa Government ".

The BJD government had come under attack from opposition Congress and BJP in the wake of the scam detected by the vigilance wing of the state in the purchase of pulses for anganwadi, mid-day meal and food nutrition programme.

Women and Child Development Minister Pramila Mallick resigned last month after the scam came to light.

Oil slides below $100 mark on Japan disaster

NEW YORK: Oil prices continued to slide Friday, dropping below $100 per barrel for the first time in more than a week, after a massive earthquake spawned a tsunami that slammed into northern Japan.

Japan is the third-largest oil importer in the world. It's unclear how much its economy will be affected by the disaster. The news helped slow down what had been a sharp, three-week rally in oil markets.

Benchmark West Texas Intermediate for April delivery tumbled $2.06 to $100.64 per barrel in morning trading on the New York Mercantile Exchange. Prices dropped as low as $99.01 per barrel earlier in electronic trading.

Oil prices have surged 24 percent since the middle of February, crossing the $100 mark as uprisings in Libya forced much of the country's oil production to shut down. The wave of pro-reform protests across North Africa and the Middle East rattled energy markets, and many oil traders fretted about unrest spreading to Saudi Arabia. Rallies planned in that country for Friday appeared to draw small crowds, and none in the capital, as Saudi rulers deployed hundreds of police and blocked roads. Officials also beefed up security around the country's oil fields.

"This is a market that's ripe for a correction," analyst and trader Stephen Schork said. "Everyone was waiting for this 'Day of Rage'" in Saudi Arabia, "but at this point, there aren't any headlines" to suggest that the country's oil fields are in danger.
Meanwhile gasoline prices in the U.S. continue to rise. The national average for regular climbed above $3.54 per gallon on Friday. That's 42.7 cents higher than a month ago and 76.6 cents more than the same time last year, according to AAA, Wright Express and Oil Price Information Service.

In other Nymex trading for April contracts, heating oil was unchanged at $3.0416 per gallon and gasoline futures dropped 3 cents at $2.9936 per gallon. Natural gas rose 7 cents to $3.902 per 1,000 cubic feet.

In London, Brent crude gave up $1.64 $113.79 per barrel.

High oil prices will certainly be a risk for India: Taimur Baig, Deutsche Bank

3/04/2011

In an interview with ET Now, Taimur Baig, Chief Economist-India, Deutsche Bank, talks about the budget, fiscal deficit target and rising oil prices, and shares his outlook for the long-term bond yields for India.

What is your reading of the budget 2011-2012? Is the fiscal deficit target of 4.6% achievable or is that a given?

We do not think so. There are several reasons. We do not disagree with the government’s forecast as far as revenue side is concerned. The sort of buoyancy that is expected on corporate tax income or excise or customs seem broadly reasonable to us and we do expect those targets to be achieved without much of an effort from the government’s side.

On the spending side, we have quite a bit of misgiving. Take, for example, the subsidy budget. In a year when we will see world oil prices may be 25-30% higher than last year, the expectation from the government side is that the subsidy bill would actually decline by 25-30%. This in our view is simply not believable because we do not think the government could actually pass through so much in domestic retail price adjustments that the subsidy budget would be achieved. So in our view there is a huge risk of the fuel subsidy in particular - fuel, food, fertiliser, all of those together - that there is a significant chance of those being exceeded than what the expectations are.

Also, on the non-planned spending side in relation to subsidies, the government has planned very conservative numbers as far as economic services and social services spending are concerned. We do not think those are achievable given how much those spending categories were elevated last year. So taking those two issues into account, we think that there is as much as 0.5% of GDP upside risk to the spending side which means that unlike government’s about 4.5% of GDP forecast, we are looking at about 5% of GDP. 


How do you believe FIIs are viewing the budget?

The expectations going to the budget were actually fairly low. Given that the government is looking at a series of state elections this year and there have been a series of governance related challenges to the government, it was not the perfect time for very bold reforms and we did not get any bold reforms. So as far as foreign institutional investors are concerned, there are not any triggers in this budget that would propel them to increase or change their view significantly more positively toward India. But at the end of the day, given that expectations were not very high, the chance of disappointment is also on the low side.

What is your outlook for the long-term bond yields for India? Is there a chance that the government may actually overshoot its net borrowing target?

If one believes our forecast that the deficit would actually be 0.5% points higher as a share of GDP, then the chance of net borrowing being higher than budget is going to be higher. But the government does have a fairly comfortable cash buffer. So they could run down that to finance higher deficit. That could be one way to control the amount of additional borrowing they might need.

Indonesia's Central Bank Leaves Key Rate Unchanged

(RTTNews) - Indonesia's central bank on Friday retained its key interest rate after raising it by a quarter point in February. Today, Bank Indonesia left the benchmark interest rate unchanged at 6.75%.
The board said inflation can be maintained at a target of 4%-6% this year. Inflation in Southeast Asia's largest economy had slowed to 6.8% in February from 7%.
But the central bank said the risk of future inflation pressure remains high.