27 January 2009

70,000 jobs axed as global financial crisis deepens ~ABC Sydney

Companies around the world have slashed more than 70,000 jobs in a single day as the global economic slump deepens.

No sector has been immune from the new wave of job losses.

Construction equipment maker Caterpillar, which has operations in Australia, is cutting 20,000 jobs worldwide.

Drug manufacturer Pfizer will shed 19,000 workers when it completes a takeover of a rival drug giant Wyeth.

Also axing jobs is car maker General Motors, banking and insurance group ING and electronics firm Philips.

Telecommunications company Sprint Nextel is shedding 8,000 staff or 14 per cent of its workforce.

Home improvement retailer Home Depot is axing 7,000 positions.

All of these jobs cuts were announced within the space of couple of hours.

They follow deep cuts last week at computer firms Microsoft and Intel and at United Airlines.

A sombre US President Barack Obama fronted the cameras at the White House to sympathise with those workers affected.

"These are working men and women whose families have been disrupted and whose dreams have been put on hold," he said.

Mr Obama used the shocking news to step up pressure on the US Congress to quickly pass his proposed $1.2 trillion economic stimulus package.

And a grim report by the National Association of Business Economics says nearly half of those companies surveyed expected to make what they described as "significant" job cuts over the next six months.

The survey says America is facing its worst business conditions in nearly 30 years.

Japanese cuts


Japan's top car makers say they are planning to cut 25,000 jobs by the end of March.

Despite being in better shape than the big three US car makers, Japan's auto manufacturers are taking drastic measures to weather the global financial storm.

A survey of Japanese car makers has found they expect to slash 25,000 jobs by the end of the Japanese financial year in March.

The survey says the leading 12 auto manufacturers also plan to cut their combined production by at least 3 million cars from their original output targets.

1 comment:

marxist-socialist said...

THE LONG DARK PESSIMIST NIHILIST NIGHT FOR THE US ECONOMY

http://financialsense.com/fsu/editorials/vaughn/2009/0126.html

As we enter the New Year 2009 we will continue to discover a great deal of changes.

Those bright sunny days of yesterday with portfolios climbing to the sky and house prices reaching for the moon are behind us. For the investment world there is no more bright sun. For the interim period we shall experience a long dark night.

Don’t worry. No cycle lasts for ever. Probably in another 15 or 20 years the light of day may just break over the horizon. Ask the Japanese. I believe they have been waiting about 20 years for their financial maelstrom to come to a close. We have a new president now. A new administration and even this new leader has been very honest in stating that what we are experiencing will not be a quick walk in the park.

“Not too long ago, people who warned about the collapse of the banking system were called doom-and-gloomers. Nowadays, they're called central bankers. If you're among the ranks of the petrified, you should consider investing in gold.” “When paper dollars decrease in value, people put their trust in real assets, such as gold.”“…gold has soared while the value of the U.S. dollar has risen. Normally, the two move in opposite directions. What gives? In a word: fear. “Although gold is an inflation hedge, it's also a catastrophe hedge.” "The banking and financial system is deteriorating," says Joe Foster, portfolio manager for Van Eck International Global Investors Gold fund.” “In short, it's a perfect time for gold, Foster argues. Even though prices are flat or falling, fear of economic collapse has been propelling the yellow metal higher.” “The government's response to the economic downturn — pumping up to $1 trillion into the economy and pouring another $750 billion into the banking system — could also be a boon for gold.”
usatoday.com/money/perfi/columnist/waggon/2009-01-22-investing-gold_N.htm

The major event that ended the depression in the 1930s was the introduction of the Second World War. I hate to think that for us we will need a third world war and major world conflict to spur demand for material goods.

Bill Buckler – “What financial and monetary officials in the US (and almost everywhere else) are in the process of doing is acting to destroy the viability of their "money" in an attempt to rescue their banks - the conduit for getting their "money" into circulation without having to actually "print" it. The end result of their actions will be a destruction of the money as a viable medium of exchange and there is, as yet, nothing on the horizon to suggest they are going to stop. In such circumstances, those who foresee a "good year for Gold" are certainly doing so on very good grounds indeed. The gyrations in the Gold price this week is just one more indication that the ultimate choice about what to use as money is getting closer.” the-privateer.com/gold6.html

The long night. A new era has begun. We have been in the midst of the transformation of this new era for the past few years. But only in 2008 did things really begin to gel and shift into high gear. And as we are watching every day the long tumble down just seems to continue to crumble faster and faster. Companies are laying off simply to prepare themselves for darker financial times. The American consumer has quit spending…the life blood of the US economy. And how much longer foreigners will continue to pump money into US securities is anybody’s guess. Debt has become taboo and dangerous.

To simply hold onto and to preserve ones capital is the dream of every investor. Forget seriously about making money through normal conventional means…those days are past. Everyone is making every attempt to transfer their assets into cash. Of course this will really do a lot of good when inflation eventually takes hold and begins in earnest.

“How can you tell that this is yet another panic phase of the market? You can look at plunging stock prices. But the recent surge in the price of gold really tells the story.” “Simply put, gold does well when investors think the world is coming to an end. It's a hard asset, which makes it a more stable bet than stocks, corporate bonds and currencies.” "Where do you hide if you want to be defensive? There are fewer and fewer places," said Axel Merk, president of Merk Mutual Funds a Palo Alto, Calif.-based money manager specializing in currency investments.” “…experts are starting to think that a return [to] $1,000 gold is not out of the question.” "Over the next two to three months, gold is very likely to break above the peak," said Carlos Sanchez, associate director with CPM Group, commodities research firm based in New York.” “But Merk points out that longer-term, he's bullish on gold since he thinks that inflation, and not deflation as many fear, will once again become an economic concern.” “That's because he expects all the money the government has pumped into the system through rate cuts, bailouts and lending programs will eventually lead to inflation.” “But the cure to the disease will make gold go up…” money.cnn.com/2009/01/23/markets/thebuzz/index.htm?postversion=2009012316

An individual in my church who owned 10 paid for apartment units across the street from Bob Jones University just sold them to get into cash. And this individual makes an easy 150,000 a year not even counting the rental income. The point being though is that his instinct as a business man is to begin accumulating cash.

Life really isn’t simply about starting over. We live really more a marathon that requires a start and then a finish. We may run fast and successfully at times and then there are the times our run turns into a struggle and a crawl. That’s about where we are today…crawling to keep our jobs and struggling simply to pay the next monthly mortgage payment. We might live in different houses. Our jobs may be something different every few years. Our marriage may dissolve, but the marathon of life continues. Our choice often is not several different paths in front of us but to merely continue on the path we began when we were born. The long haul from birth to death. And everything that comes in between.

"We are experiencing an unprecedented economic crisis that has to be dealt with and dealt with rapidly," Obama said during the meeting. "How does that stimulate the economy?" “…White House Press Secretary Robert Gibbs countered: "There was a lot of agreement in that room about the notion that we're facing an economic crisis unlike we've seen in quite some time ... that we must act quickly to stimulate the economy, create jobs, put money back in people's pockets." nypost.com/seven/01232009/news/politics/prez_zings_gop_foe_in_a_timulating_talk_151572.htm

Personally, I do not think these stimulus packages are going to be successful at creating new long term jobs or building factories and overall improving our status of living which is now deteriorating. It’s not a matter of being pessimistic but truthful. In the 1930s it took the introduction of a Second World War to really get the economy on its feet again and moving full steam ahead. I fear long term that will be the situation again that repeats itself. Millions will have to die again in war to bring prosperity. But at least all political parties are in agreement that we are experiencing a long slide down hill that will not correct itself in just a few short years. I believe the Japanese will continue to remind us that some economic falls can last for over ten years and longer. A long time to wait for prosperity’s return.

“President-elect Barack Obama predicted Tuesday that the nation could see "trillion-dollar deficits for years to come," but said the country needs to continue spending taxpayer dollars to get the economy back on track.” “…we've got trillion-dollar deficits for years to come…” foxnews.com/politics/2009/01/06/congress-convenes-confront-economic

Considerable inflation is coming. Washington has yet to learn who the real enemy will ultimately be…inflation. This is why gold will continue to hold its own and have a future. Gold bullishness is coming. Inflation will raise its ugly head again to parallel the double digit inflation of the 1970s. We are indeed living in interesting times. The world's economy is collapsing. Many are convinced that the harm done to the world's financial system is so great that the hope of a recovery in the foreseeable future is an impossibility. The big mystery for 2009 is just how far and how fast the world financial system will collapse.

We’ve just completed an article recommending six gold stocks whose prices have been driven to a ridiculous low. These are quality mining companies with the gold in the ground. And their market cap is less than their cash in the bank? Buy! These are the type of companies to acquire that have the potential to make a lot of money as the precious metals market turns around.

Inflation is coming.

Massive. It’s inevitable. And inflation is the best scenario for higher gold prices. Speculate only what you can afford to lose. Gold is still going to be around even after all this economic mess settles down a bit in twenty years. Gold mining stocks now are a life time opportunity. Be brave. Buy low. Sell higher.

“The United States has no monopoly on currency devaluation. It’s a global phenomenon, and most countries are participants. Only one currency cannot be devalued by governments: gold. Unlike fiat currencies, it is not vulnerable to the best laid plans of mice and men.” “The fundamentals also look strong on a micro level. I’m not referring to a discounted cash flow analysis or anything like that. Rather, I mean that it is cheaper for the majors to buy juniors at these levels than it is for them to explore and develop new properties.” “The junior miners are trading well. Most junior miner stock charts show positive patterns. In the aggregate, they seem to indicate a modest return of speculative interest to the sector.”