The informal economy of Romania represented 28.4% of GDP in 2013, taking into account a slight decrease compared to 2011, when calculating the 30% of the GDP. More »
The second largest company in the world for card payments MasterCard reported higher than expected earnings in the second quarter, thanks to growth in the volume of payments. The net income increased by 10% to 931 million USD (80 cents per share) between April and June, compared to 848 million USD (70 cents per share) a year earlier. The net income grew by 13.4% to 2.38 billion USD.
The average estimate of analysts was for earnings per share of 77 cents and revenue of 2.31 billion USD. The volume of payments made with cards MasterCard, swelled by 12.5% to 821 billion dollars, calculated in local currency due to gains in Europe, Asia-Pacific, Middle East and Africa. The volume of payments in the United States increased by 10.1% to 289 billion USD.
The price of the shares of MasterCard rose by 2.3% since published financial results in May, trailing the index S&P 500, which added 4.6% to its value over the same period.
The Asian indexes closed on green, for the second consecutive session. They were supported by hopes that the growth of the Chinese economy in the world finally stabilized. The investors are increasingly optimistic about China in recent sessions amid better economic data such as the July report on manufacturing activity. The positive news sent the benchmark Shanghai Composite to 7-month high. The Hong Kong’s Hang Seng index rose again to 4-year high. The main risk events to come later this week, were also in the spotlight. Wednesday is expected next meeting of the US Federal Reserve, to which the institution is likely to continue the course of lowering your monthly purchases of assets to 25 billion USD. The focus will be data on the US economic growth in the second quarter and the government index of purchasing managers in China. The Chinese Shanghai Composite rose 0.24% to 2,183.19 points, recording its eighth consecutive session of growth. Meanwhile, the CNY hit a new four-month high against the USD. The insurers reported mixed performance amid signs that Chinese regulators are considering new measures to tighten rules in an attempt to reduce the risk of failures. The capitalisation of New China Life Insurance slid more than 2%, while China Life Insurance added nearly 1%.
The informal economy of Romania represented 28.4% of GDP in 2013, taking into account a slight decrease compared to 2011, when calculating the 30% of the GDP shows an assessment of the European Commission said in a report of the Committee of experts Council of Europe to assess measures to combat money laundering and financing of terrorism (MONEYVAL). Thus, the level of the shadow economy in 2011 was in line with losses for the country in the amount of 40 billion EUR, this amount has remained constant during 2013, whereas GDP growth.
According to estimates by the European Commission in Romania the ratio of the shadow economy in 2011 was 30% of GDP (in 2013 this proportion dropped to 28.4%), which is consistent with the loss of 40 billion EUR caused by economic abuse and tax evasion.
According to the report in 2012, the number of economic abuse was 41,820 compared to 39,124 in 2011 and 34,730 in 2008, the same time the number of fraud doubled in 2012 compared to 2008 – from 12 579 to 25 586 cases. The damage caused annually to Romania only cigarette smuggling is estimated at about 400 million EUR. The number of people smuggling charges in 2012 increased by 184% compared to 2007, reaching 879 people.
Wall Street indexes finished the session without single direction, as Dow Jones rose with 0.13% to 16,983 points, S&P 500 added 0.03% to 1, 979 points and Nasdaq lost 0.1% to 4,445 points.
The strong growth in today’s session marked the shares of utilities – an average of 1.46%. Follow telecoms with an increase of 0.46%. At the other extreme are companies from the construction sector, as a sector sub-index fell 0.5%. The gold futures for delivery in August remained unchanged in today’s session on the stock exchange in New York amid geopolitical risks. The price per ounce was 1,303.3 USD.
The experts explained that the price changes are minimal because of pent-up demand in China and India – the leading markets of the precious metal in the world.
UBS reported 15% profit growth in Q2 2014 amid lower costs. The net profit the lender rose to 792 million Swiss CHF (876 million USD) compared to 690 million CHF an year earlier, said the Zurich-based institution. For comparison the analysts predicted a slight increase to 719.3 million CHF.
The CEO of UBS Sergio Ermotti made a big cost reductions in the amount of 2.1 billion CHF after the bank was facing increased pressure due to the decline in revenues and higher costs of litigation. The Bank aims to promote the return on equity to more than 15 percent by 2016 from 7.6% in the first half of this year. The cost of UBS fell by 6.9% to 5.9 billion CHF during the quarter, which helped their level reaches 82.8% of revenue compared to 86.2% an year earlier.
Earlier this year, the bank paid 300 million EUR (403 million USD) to the authorities in the German city of Bochum to settle the dispute whether help their clients to evade taxes. The lender set aside 120 million CHF for settling disputes during the quarter, bringing the total cost of legal provisions for the period amounted to 254 million CHF.
Deutsche Bank AG announced profit decrease by 29% yoy in Q2 2014, caused by lower non-interest profits and higher taxation. The net profit of the lender in the three months to the end of June fell to 237 million EUR compared to 334 million EUR for the same period last year. Remained below the level expected by experts polled by Bloomberg for a profit of 470 million EUR. The global investment banks try to cut costs in order to push up profits amid tighter regulations and record-low interest rates of central banks tightened in recent years, proceeds from loans and trading bonds.
“Nobody expects a good performance against the very difficult revenue environment”, said before a statement Stephan Bongard, an analyst at Independent Research GmbH. “The company needs to show investors that the trend in trade debt will change in the coming quarters. Their patience is not infinite”, he added.
The former Chairman of the US Federal Reserve (Fed) Chairman Alan Greenspan has always been a student of economics. After the financial crisis, he became a student of human nature. Sitting in his office overlooking the Washington Monument, Greenspan is eager to share his insight that in his latest book “The Map and the Territory”, to be printed in the fall.
The 88-year-old Greenspan was Fed chairman for more than 18 years in the period 1987 to 2006, he managed to bring the economy in many crises primarily through lower interest rates and optimism.
But after leaving office, he has experienced a remarkable fall. He apologized for having believed too many of the big banks again reconsider his views on the economy. Greenspan is currently president of the consulting firm Greenspan Associates LLC.
“The economy will do everything necessary in the short term, supported by a strong rise in the stock market”, he says, but remains worried that “we may be facing a new downturn”. According to him, the biggest challenge facing the Fed is how the central bank to cut its huge balance sheet with minimal consequences. “It will not be easy, and obviously it is not clear how it will happen”, said Greenspan, hoping that the Fed will stop smoothly the current monetary course.
The leading Asian indexes closed in different directions, though they were taken up after a positive session on Wall Street last night. Chinese stocks led the losers in the region after the money supply in the Celestial Empire grew the slowest pace in more than a decade. In Japan, the Nikkei 225 rose with 0.62% to 13,996.81 points. In China, the Shanghai Composite fell 1.40% to 2,101.60 points. The Hong Kong’s Hang Seng fell with 1.6% to 22,71.26 points.
The indices in China and Hong Kong fell after data showed that the broader monetary aggregate M2 has expanded less than expected 13% increase. Meanwhile the new loans rose by nearly 14%.
The stock exchanges in China and Hong Kong financial sector suffered the most. Mood influenced the news that day only for Chinese central bank will draw the most liquidity in the market since February. The shares of Citic Securities fell 3.6%, while those of the Merchants Bank and Minsheng Bank – with 2% each.
The South Korean KOSPI wiped 0.24% of its value, while Australian S&P ASX 200 registered a growth of 0.55% to 5,388.16 points and moves away from the bottom two-month reported yesterday.
Brussels has been under pressure from Germany to loosen restrictions on subsidizing clean energy to clear the way to the German Government the adoption of the crucial law on renewable energy sources. The European Commission (EC) will probably change the rules on State aid, which would allow one party to the rapid removal of subsidies for renewable energy, but at the same time continuing the rebates for green energy on a large scale indicates publication.
Amendments to the rules will allow the German government to adopt new law on renewable energy without impacting the requirements of the European Union (EU). The reform of the German Energy became necessary after the previous government of Angela Merkel has decided to abandon nuclear energy after the Fukushima accident. The biggest challenge for the Chancellor, however, to shift towards renewable sources, and who will pay for the turn in energy policy. The proposals to change the state aid rules that allow the phase out of subsidies for green energy, have brought criticism from environmental groups. According to them, these rules will greatly hinder competition with big energy companies who still cling to fossil fuels and nuclear energy. The EU Competition Commissioner Joaquin Almunia insists, however, a more market-oriented system to support renewable energy sources to prevent waste of taxpayers’ money.
The World Bank (WB) estimates that this year recovering demand from industrialized countries will stimulate economic growth in the export-dependent countries in Asia. According to the international financial institution developing Asian economies will grow by an average 7.1% this year. In practice, the bank forecast remains that in 2013 China will increase its gross domestic product (GDP) of 7.6% instead of 7.7%, as expected by the World Bank in 2013. According to the latest research by Finweek Journal, the report by international lenders indicates that the process of reducing the size of asset purchases by the US Federal Reserve, which began this year, which should after a certain time to raise the yield on US Treasuries, it has caused great losses Asian markets.
“The strong global economy growth this year will help the enlargement of the region at a relatively steady pace until he adjusts to tighter global financial conditions”, said Vice President of the World Bank for the East Asia Axel van Trotsenburg.