Global Economics: The Truth and a Warning

Source Video: World United News

https://www.youtube.com/watch?v=HHTpRDM96YQ

By: Stewart Brennan
http://worldunitednews.blogspot.com/

 

Every country will face a “Tipping Point” and breakdown of society in the near future due to the crushing economic austerity measures inflicted on the people by the brutal International Banking System that was conceived and designed to acquire wealth and power for an elite few.

When impoverished nations reach their economic tipping point, the governing power structure of those nations will have no options left. They will have to tell those in control of their economic system to bow down to major changes, or they themselves will face the consequences of their inaction.

At the moment, the choice to fix the broken system belongs to those in control of it. I.e.: The International Banking Cartel through the IMF, World Bank, and International Bank of Settlements…however, if the warning is ignored and the choices made by those who govern the system only ensure that the extremely wealthy survive these harsh economic times, then the responsibility to correct the economic disparity will shift to the impoverished masses by virtue of their will to survive.

Be assured that “Civil Unrest” will grow proportionally to the rise in poverty. All one needs for proof is catch a glimpse of what is unfolding in Egypt, Greece, or Spain to see the truth of these words…and there are many other nations at different stages of bankruptcy, poverty and austerity that is being forced upon them by the I.M.F (International Monetary Fund). The victims of the economic system will rise up in their millions because their very survival depends on a just system for all. 

However, the problem is not just that the IMF has taken control of every nations economic sovereignty but that the corporate power structure that comes with the Private banks has also taken control of the natural resources of most countries. 

Making matters worse for the people of the World is that the entire political system in every country, with few exceptions, has been seized at every level by the same corrupt banking system.

Even the opinions on mainstream news are bought and paid for by corporate interests. Don’t believe me? Well Just try to get a differing opinion aired to the public on these mediums and you’ll soon see that it becomes painfully obvious where these news corps feed, because you Will be denied your opinion, just as investigative journalism has been denied when it contradicts the banking or corporate plans of the extremely wealthy that control the mainstream press.

Personally, I no longer watch TV, read newspapers or listen to the radio airwaves anymore because they are arrogantly biased and illogically opposed to common sense.

Call it what you will, but be assured that everyone will wake up to these facts sooner or later and when they do, there will be hell to pay…the degree will depend on how far the banking cartel try to take their illusion.

The Solution:

Nationalize all the private banks in each country to end the existence of “The IMF, World Bank, and the Bank of International Settlements”. Then each country must Nationalize all their natural resources so that the profits go into the nations coffers that supports the communities and the social programs. Reorganize the political structure so that real qualified people govern the nation. Money must not be allowed to affect the political structure ever again.

The World is yours to build, we do not need Private Banks to control it.

Stewart Brennan

World United News
http://worldunitednews.blogspot.com/

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World Bank slashes growth outlook

The World Bank warns that Europe is headed for a recession that could spark a global crisis

Source: Press TV
http://www.presstv.ir/detail/221686.html

The World Bank has downgraded its estimates for a global economic expansion in 2012, saying that developing countries should brace themselves for a growth slowdown.

In its Global Economic Prospects report, the bank has cited the eurozone crisis, weak economic growth and contagion from the European Union spreading to the rest of the world as reasons for lowering its 2012 global growth forecast.

The bank says that both developing and developed countries will be affected by the critical situation of the world economy.

The World Bank has lowered the 2012 global growth forecast for high-income countries from 2.7% to 1.4% and also revised the growth of developing countries down to 5.4 percent from 6.2.

It has said that it is not being cynical, however, "we are examining the possibility that things could go worse," said Andrew Burns, a manager at the World Bank.

He added that the purpose of the dismal tone of the Global Economics Prospects 2012 report is to prepare developing countries for such possibilities.

The World Bank's report comes at a time of mounting fears of a Greek default and after the Standard and Poor's (S&P) credit rating agency downgraded the ratings of nine European countries including France and Austria last week.

'World economy in a new danger zone'

World Bank President Robert Zoellick

Source: Press TV
http://www.presstv.ir/detail/197596.html

The World Bank has warned that record-high food prices and the global economy have reached unsafe levels, pushing the world's most vulnerable people at risk.

"The world economy is entering a new danger zone this autumn," AFP quoted World Bank President Robert Zoellick as saying at a conference in Beijing on the future of China on Saturday.

The World Bank chief also called on the United States to “address its issues of debt, spending and tax reform to boost private sector growth and a stalled trade policy."

Zoellick went on to urge China to accelerate its structural reforms which cater more towards its export-driven economy, and is less reliant on its domestic consumption.

"China's structural challenges occur in a current international context of slowing growth and weakening confidence," Zoellick warned.

He added that China would face further challenges in the years ahead.

"In the next 15 to 20 years, China is well-positioned to join the ranks of the world's high income countries," the head of the World Bank stated, warning "That's a transition that only a handful of countries have made - and, sadly, many have failed".

Zoellick said in August that investors had lost confidence in the economic leadership of several countries, led by America's bitter Congress debate to raise its debt ceiling and avoid default.

The United States is almost 15,000 billion dollars in debt, and as the most indebted country of the world cannot pay off its debts.

The European Union has meanwhile spent much of the past 18 months trying to battle its own debt crisis and has so far provided huge funds to Greece, Ireland, and Portugal with hefty bailout packages.

300,000 children starving in Horn of Africa

More than 300,000 children in the Horn of Africa are at risk of dying, the UNICEF says.

Source: Press TV
http://www.presstv.ir/detail/194768.html

UNICEF says more than 300,000 children in the Horn of Africa suffer severe malnutrition and are in imminent risk of dying due to the worst drought and famine in decades.

UNICEF Executive Director Anthony Lake said on Friday that the crisis in the Horn of Africa is “a human disaster becoming a human catastrophe,” the Associated Press reported.

In Somalia alone, around 1.4 million children are affected, an estimated 390,000 are suffering from malnutrition, and nearly 140,000 in the south-central region are facing imminent death from “severe acute malnutrition,” Lake added.

According to the United Nations, tens of thousands of people have already died in Somalia, Kenya, Ethiopia, Djibouti, and Eritrea, and more than 12 million people in the region need food aid.

UNICEF has also said the combination of malnutrition, lack of clean water, and poor sanitation, along with the rush of thousands of people into the Somali capital Mogadishu in search of food, have had terrible consequences.

“There is no need for a child to die of diarrhea, yet this is a tragic reality for a Somali child, who is acutely malnourished. It is a lethal combination,” UNICEF Representative for Somalia Rozanne Chorlton said.

'Horn of Africa famine manmade'

Source: Press TV
http://www.presstv.ir/detail/194347.html

The famine in the Horn of Africa is a result of artificially high prices for food and civil conflict than natural and environmental causes, a World Bank's expert says.

"This crisis is manmade," said lead economist for Kenya Wolfgang Fengler in a phone interview with Reuters on Tuesday. "Droughts have occurred over and again, but you need bad policymaking for that to lead to a famine."

The price of maize, or corn, was significantly higher in east Africa than in the rest of the world due to controls on local food markets, he noted. "Maize is cheaper in the United States and in Germany than it is in eastern Africa.”

"In Kenya, the price for corn is 60 to 70 percent above the world average at the moment," Fengler added. "A small number of farmers are controlling the market which is keeping prices artificially high."

The World Bank President Robert Zoellick had also warned that global food prices, which have reached near record highs, are threatening the lives of the poorest people around the globe.

Food prices around the world were 33 percent higher this July than in 2010, while oil prices have climbed 45 percent, ramping up the price of fertilizers, Zoellick said on Monday.

The drought and famine have affected more than 11.8 million people across Somalia, Ethiopia, and Kenya. Somalia has been the hardest-hit country in what is being described as the worst drought in the Horn of Africa in 60 years.

Over the last three months, reportedly 29,000 children under the age of five have died of malnutrition and starvation in Somalia while the lives of 600,000 children in the region remain at risk, the bank has revealed.

"Persistently high food prices and low food stocks indicate that we're still in the danger zone, with the most vulnerable people the least able to cope," World Bank President Robert Zoellick announced in a statement.

He also warned of the high volatility in goods markets, calling for international alertness to the possibility of widening crisis.

World Bank warns of poor world market outlook

World Bank President Robert Zoellick

Source: Press TV
http://www.presstv.ir/detail/193982.html

World Bank (WB) President Robert Zoellick has warned of dire prospects for global markets as investors lose confidence in the economic leadership of Western countries.

Zoellick emphasized on Sunday that the latest financial downturns in the United States and Europe have shaken up investors in Western nations, which are already struggling to overcome debt issues and unemployment, AFP reported.

"And I think that those events combined with some of the other fragilities...have pushed us into a new danger zone. And I don't say those words lightly,” he noted.

Zoellick added that last month's political wrangling in the US Congress over the raising of the country's debt ceiling has contributed to the confidence deficit.

"When they saw the 'Sturm und Drang' in Congress and with the [chief] executive (the US President Barack Obama), it made them uncertain about; does the United States really know where it's going? And is it going to get there?" he asked.

Intense party politics and rivalry between Democratic and Republican lawmakers on Capitol Hill over critical federal budgetary and deficit issues brought Washington very close to its first-ever debt default earlier this month.

The WB chief said the financial doldrums in the US were even far graver than those of the Eurozone.

The EU has spent much of the past 18 months trying to battle its own debt crisis and has so far provided huge funds to Greece, Ireland, and Portugal with hefty bailout packages. European governments have started efforts to rush measures through their own parliaments to bring stability to European financial markets, which have taken major dives over the past week.

"We're kind of moving from drama to trauma for a lot of the Eurozone countries," Zoellick asserted.

World Bank warns against future economic hardship

World Bank President Robert Zoellick

Source: Press TV
http://www.presstv.ir/detail/193744.html

Amid the ongoing financial crisis in the United States and Europe, World Bank (WB) President Robert Zoellick has warned that more dangerous times will be ahead for the global economy.

"In the past couple of weeks, the world has moved from a troubled multi-speed recovery to a new and more dangerous phase," Zoellick told the Weekend Australia newspaper on Saturday.

He also said the eurozone's sovereign debt issues were more troubling than the medium and long-term problems that led to the downgrading of the US's rating by the credit ratings agency, Standard & Poor's last week.

"We are in the early moments of a new and different storm, it's not the same as [the] 2008 [financial crisis]," he added.

The head of the World Bank urged the European leaders to approach their debt problems with a greater sense of urgency.

"The lesson of 2008 is that the later you act, the more you have to do," Zoellick said.

He also questioned whether troubled European nations could "ever get ahead of the problems that have plagued them."

Zoellick pointed out that the world is now involved in redesigning the international financial system and that power is moving rapidly to fast-growing nations like China.

Putin: IMF head victim of conspiracy

Russian Prime Minister Vladimir Putin

Source: Press TV
http://www.presstv.ir/detail/182433.html

Russian Prime Minister Vladimir Putin says the sexual assault case against former IMF head Dominique Strauss-Kahn could be a conspiracy to tarnish his image ahead of French elections.

Putin said the controversial charges against the former director of the International Monetary Fund (IMF) is hard to accept, adding that he is worried that Strauss-Kahn might be the victim of a plot to discredit him and stop him from running for president in France.

"It is hard for me to evaluate the real political underlying reasons and I do not even want to get into that subject, but I cannot believe that everything is as it seems and how it was initially presented," Putin told Interfax news agency, quoted by the Daily Telegraph.

"It does not sit right in my head."

A French politician earlier claimed that Strauss-Khan, just days before his arrest, had said he believed Putin was plotting to oust him from his position as head of the IMF.

"He said the Russians and notably Putin had allied themselves with France to try to have him fired from the IMF to stop him running for (French) president," Claude Bartolone, a socialist politician, said, according to the Telegraph.

Strauss-Kahn is awaiting a grand jury decision on whether to indict him on charges of sexual assault and attempted rape of a 32-year-old Manhattan hotel chambermaid.

Strauss-Kahn was arrested on May 14 over allegations that he had sexually attacked the cleaning lady at a luxury hotel near Times Square.

He was expected to declare his candidacy for the French presidency soon and considered as a strong contender to defeat President Nicolas Sarkozy in next year's elections.

Strauss-Kahn, 62, could face 5 to 25 years in prison if convicted.

'Ex-IMF chief will be cleared of charges'

Former International Monetary Fund chief Dominique Strauss-Kahn

Source: Press TV
http://www.presstv.ir/detail/181281.html

Former chief of the International Monetary Fund (IMF) Dominique Strauss-Kahn will be cleared of charges of attempted rape against a New York hotel maid, his lawyer asserted.

Strauss-Kahn's main attorney, Benjamin Brafman, has announced that his client will plead not guilty and would be cleared of recent sex assault charges, AFP reported.

"Nothing is certain, but from what I've discerned in the investigation, he will be acquitted... He has impressed me very much. Despite the circumstances, he's doing well,” Brafman stated.

There has been no announcement on whether the police have discovered any DNA evidence that would prove the high-profile Frenchman guilty of the seven charges brought against him by the New York Police Department, including the alleged rape of the 32-year-old female employee at the Sofitel hotel in New York.

However, prosecutors at last week's bail hearing have insisted that the evidence compiled in the case supports the woman's claims.

The former French finance minister, who has rejected all charges against him, has paid $1 million in cash and has deposited a $5 million insurance bond in order to secure his release on bail.

Strauss-Kahn will have to appear in court on June 6 to formally enter his plea. His full trial may still be months away.

Strauss-Kahn resigned as managing director of IMF on Wednesday amid concerns over the future of ongoing talks about the euro zone debt crisis.

He was also expected to declare his candidacy for the French presidency soon and was considered as a strong contender against the current President Nicolas Sarkozy in next year's presidential election.

Benjamin Brafman is a New York-based criminal defense attorney who maintains a criminal defense firm, the Brafman Associates.

Brafman has handled cases for clients including Michael Jackson, Sean Combs, Peter Gatien, James Patino, and Vincent Basciano.

Strauss-Kahn's security conditions for his bail costs over $200,000 a month.

Geithner: Strauss-Kahn cannot run IMF

US Treasury Secretary Timothy Geithner

Source: Press TV
http://www.presstv.ir/detail/180511.html

US Treasury Secretary Timothy Geithner has questioned the International Monetary Fund (IMF) chief's competency, saying he doubts Dominique Strauss-Kahn can lead the organization.

"He's obviously not in the position to run the IMF," AFP quoted Geithner as saying on Wednesday.

Addressing the Harvard Club in New York on Tuesday, Geithner said the IMF's executive board should designate an interim head.

Geithner's remark came in the wake of Strauss-Kahn's sexual scandal, which may put the embattled French official behind bars.

The 62-year-old French politician was arrested on charges of sexual assault against a hotel maid on Saturday.

A New York court then jailed him in notorious Rikers Island jail after his bail was denied by a judge.

On Monday, Strauss-Kahn pleaded not guilty to the charges brought against him.

He, however, would be kept in solitary confinement until his next court session on Friday.

Strauss-Kahn faces charges including attempted rape, sex abuse, criminal sex act, unlawful imprisonment and forcible touching. He could face 5 to 25 years in prison.

This is the first time a senior official from US President Barack Obama's administration has publicly spoken about the issue. However, Geithner refused to comment on the case or the details of the charges against Strauss-Kahn.

The IMF chief was detained onboard a plane on Saturday before flying to the French capital, Paris.

The IMF is the intergovernmental organization which oversees the global financial system through the macroeconomic policies of its member countries.

IMF chief charged with 'attempted rape'

International Monetary Fund (IMF) Director General Dominique Strauss-Kahn

Source: Press TV
http://www.presstv.ir/detail/179974.html

International Monetary Fund (IMF) Director General Dominique Strauss-Kahn has been formally charged with sexual assault after attacking a maid in a New York hotel, police say.

The charges included "criminal sexual act, unlawful emprisonment, attempted rape" and "assaulting a 32-year-old girl in a hotel room," Ryan Sesa, a police deputy spokesman, told reporters.

Strauss-Kahn was arrested earlier on Saturday after being taken off an Air France passenger plane at a New York airport, just as the plane was preparing for take off.

He was accused of a "sex attack" on a maid at a Times Square hotel earlier in the day.

The Port Authority officers were informed by the New York Police Department, whose detectives had been investigating report of a brutal attack on a woman employee at the hotel Sofitel New York, in the heart of the city's theater district.

Strauss-Kahn was scheduled to meet German Chancellor Angela Merkel in Berlin on Sunday to discuss an aid package for debt-laden Greece.

He was then due to attend a meeting of EU finance ministers on Monday and Tuesday in Brussels.

Strauss-Kahn is a former economics professor and was being touted as a prospective candidate for the Socialist Party in their challenge to incumbent President Nicolas Sarkozy in the April 2012 French presidential election.

Married to a prominent television news reporter, Strauss-Kahn was enmeshed in a controversy after accusations arose about his sexual relationship with a senior official of the IMF's Africa Department in 2008.

The IMF is the intergovernmental organization that oversees the global financial system through the macroeconomic policies of its member countries.

World Bank warns about food prices, Middle East revolts

World Bank President Robert Zoellick

Source: Press TV
http://www.presstv.ir/detail/175243.html

The World Bank has warned that the recovery of developed economies may face further challenges due to the rising food prices, high unemployment and the uprisings in the Middle East and North Africa.

"We are one shock away from a full-blown crisis," World Bank President Robert Zoellick said in reaction to surging global food prices, AFP reported.

"The financial crisis taught us that prevention is better than cure. We cannot afford to forget that lesson," he said at the close of the annual spring meetings of the World Bank and International Monetary Fund (IMF) in Washington.

Zoellick added that the development lender should support reforms in the Middle East to prevent further revolutions in the region.

"Waiting for the situation to stabilize will mean lost opportunities. In revolutionary moments, the status quo is not a winning hand," he went on to say.

The World Bank also said in a statement that the popular uprisings in the Middle East and North Africa "could derail global growth. "

According to the World Bank's latest Food Price Watch report released on Thursday, the global food prices saw a 36 percent rise compared to a year ago. The report also estimated that a further 10 percent increase could push 10 million more people, with an income of less than $1.25 per day, into extreme poverty.

The report says 44 million people have been pushed into poverty since June 2010 because of high and volatile food prices, and a further 30 percent price hike could increase the world's poor population to 34 million.

According to the World Bank's food index, there are currently 1.2 billion people living below the poverty line of less than $1.25 a day.

China raps US meddling

China's Ministry of Foreign Affairs spokesman Hong Lei gestures for questions at a press briefing in China's capital Beijing (File photo).

Source: Press TV
http://www.presstv.ir/detail/174033.html

China has called on the United States to stop interfering in the internal affairs of other countries under the pretext of human rights issues.

China's Foreign Ministry Spokesman Hong Lei urged Washington to focus on its own human rights conditions, saying, "We advise the US side to reflect on its own human rights issues and not to position itself as a preacher of human rights," the state-funded BBC reports.

"[The US should] stop using the issue of human rights reports to interfere in other countries' internal affairs," the Chinese politician added.

Hong says China welcomes talks about rights on the basis of equality and mutual respect. However, he added that Beijing resolutely opposes meddling in other countries' affairs.

The development comes following the annual release of US State Department's report on human rights, which criticized China for rights abuses.

The American report, considered by many observers as more of a political document against countries not in good terms with the US, accused Beijing of stepping up restrictions on lawyers and journalists.

US Secretary of State Hillary Clinton also claimed on Friday that Beijing's record on human rights was worsening.

"We remain deeply concerned about reports that since February, dozens of people including public-interest lawyers, writers, artists, intellectuals and activists have been arbitrarily detained and arrested," Clinton said.

The Asian country has also been accused by the US of tightening controls on civil liberties and imposing more restraints over the press and internet access.

World Bank: Food prices near dangerous levels

Source: Press TV
http://www.presstv.ir/detail/165804.html

The World Bank says the global hike in food prices have reached dangerous levels, pushing some 44 million more people into poverty in just over six months.

"Global food prices are rising to dangerous levels and threaten tens of millions of poor people around the world," AFP quoted World Bank chief Robert Zoellick as saying in a recent statement.

"The price hike is already pushing millions of people into poverty, and putting stress on the most vulnerable, who spend more than half of their income on food," he went on to say.

According to the latest edition of the bank's Food Price Watch, prices rose by 15 percent between October 2010 and January 2011.

According to reports, 100 million people became prone to extreme poverty in the 2008 food crisis. The World Bank defines “extreme poverty” as living on less than $1.25 a day.

The bank's food-price index rose 15 percent between October and January, led by wheat, sugar and edible oil. The level is only three percent below the 2008 peak, when surging costs sparked riots in more than a dozen countries.

Corn has surged 86 percent in the past year, and wheat is up 69 percent after drought and floods damaged crops from Russia to Argentina. The Food and Agriculture Organization's World Food Price Index reached a record high in January for a second consecutive month

Uprising in Egypt unsettles global markets

Source: Press TV
http://www.presstv.ir/detail/163026.html

Debt agency Moody's has cut its credit rating for Egypt, making it more costly for the Egyptian government to borrow.

Concerns about the possible closure of the Suez Canal, seen by economists as a chokepoint for global trade, is also pushing up commodity prices amid fears that supplies will be disrupted. Amid all this, the US Secretary of State had this to say:

The hesitance is no surprise -- considering the massive American business interests at stake in Mubarak's Egypt. The US sends nearly one and a half billion dollars in military aid to Egypt each year -- much of which comes back to American corporations -- which sell weapons and maintenance services to the Egyptian military.

Western oil companies have been a major presence in Egypt for decades -- drilling for oil and gas and making billions over the decades of Mubarek's rule.

Going strictly by the corporate bottom line - the Mubarek Presidency has been a profitable one for American and Western multinational corporations. Experts that Press TV has spoken to - however - are not bullish about the prospects of those corporations when the subject turns to Mubarak's replacement.

Sara Flounders - Co-Director of the International Action Center - says that there will likely be a harsh new reality for all Western companies doing business in Egypt - no matter who the new president turns out to be.

Many experts speculate that Mubarak's reign will end soon. When and if Mubarek heads out the door - he will take with him the cozy relationships he had with Western multinationals - and the massive profit margins many of them have enjoyed. According to Flounders - whoever steps into the power vacuum won't have much tolerance for Western interests.

The Dow Jones Industrial Average was up slightly on Monday - but not enough to recover from its plummet last Friday as investors ran to safer stocks. What will happen to investments - however - will continue to be closely tied with what happens on the ground in Cairo.

China warns of inflation rise

China's high infllation rate prompts Beijing to tighten monetary policies

Source: Press TV
http://www.presstv.ir/detail/162845.html

China's Central Bank has warned that inflation still runs high in China, while it has launched measures to tighten monetary policies to rein in price bubbles.

“Inflation pressure is quite big,” the central bank said in its fourth-quarter monetary policy report on its website, citing rising capital inflows, labor costs and resource prices as reasons.

China will face a “relatively stable” external environment this year, and the domestic economy is likely to maintain fast growth due to investment momentum and consumer spending, the report also said.

Economists say high inflation could slow down the growth of the Chinese economy as China's consumer price index, or CPI increased by 4.6 percent in December, compared with November's 5.1 percent annual pace, which was the fastest in more than two years.

Beijing has launched a series of monetary tightening measures, including two interest rate hikes and a number of bank reserve requirement ratio increases over the last year in attempts to dampen rising consumer prices.

Central bank governor Zhou Xiaochuan said on Sunday in Japan that China's inflation is "higher than expected" and warned that banks' reserve requirement ratios (RRR) could be tightened further to mop up excessive liquidity in the country.

The central bank will also step up monitoring of the “overall financing size of the society,” which includes bonds and stocks apart from loans for policies.

China's economy is the second largest in the world.

US home prices dip for 4th month in row

As foreclosed homes flood the markets, prices could tank even further.

Source: Press TV
http://www.presstv.ir/detail/162028.html

A double-dip in the US home prices appears to be underway in America's biggest cities, endangering an already fragile economic recovery in the country.

Home sale prices fell 1.6 percent for the fourth consecutive month in November 2010, the Standard & Poor's/Case-Shiller Index, which tracks the real estate market in 20 major US cities, showed.

The housing market got a boost early last year with the help of tax incentives. But after the US government's initiatives ended, sales dropped sharply.

Falling home values result in what economists call a negative wealth effect. In this scenario, people's financial confidence is shattered as a result of lost equity in their homes.

Currently, there are more than ten million households in the United States who owe more on their homes than they have equity.

Some economists predict the US housing price, which is a key indicator of the country's economic vitality, will drop by as much as 20 percent this year.

According to their reports, the decline in home value is greater than it was in 1928 to 1933 during the Great Depression -- a severe worldwide economic depression in the decade preceding World War II.

In addition, unemployment has remained stubbornly high and millions of Americans are still at risk of foreclosure.

US economy losing to rising powers

US President Barack addresses a Joint Session of Congress while delivering his State of the Union speech

Source: Press TV
http://www.presstv.ir/detail/162006.html

Painting a grim picture of the financial trials in the US, President Barack Obama has called on authorities to gear up in order to meet challenges from rising economies.

In his State of the Union address before Congress on Tuesday, Obama said America is at the risk of losing out to rapidly developing economies, such as China and India, in the global market.

Listing areas where the United States had fallen behind the rest of the world, the US president said Americans had lost to South Korea in internet penetration, to Europe in infrastructure and to China in trains and airports.

He then called for a return to the American traditions of innovation and risk-taking to keep up with the rising powers from the East.

We need to “out-innovate, out-educate and out-build the rest of the world,” the US president pointed out.

Obama also spoke of investments in education and research as the way to provide a more sound economic base and accelerate employment and development in the country.

“Over the next 10 years, nearly half of all new jobs will require education that goes beyond a high school degree. And yet, as many as a quarter of our students aren't even finishing high school,” the US president warned.

But finding the money for programs to create a competitive economy is the problem.

That is why during his nationally televised speech, Obama urged rival politicians in the Republican and the Democratic camps to ditch partisanship for a unified push for a better future.

"We will move forward together," he said, "or not at all."

In other comments, Obama also urged US colleges to allow military recruiters and officer training programs back on campuses.

The president also proposed a three-year partial freeze on civilian programs and a $78 billion cut in military spending.

On the war in Afghanistan, he said that a tough fight is ahead, but repeated his plans to bring some US troops back home in July.

However, he pledged to continue attacks on what he called 'al-Qaeda' in Pakistan.

California bankruptcy chatter alarms investors

Source: Press TV
http://www.presstv.ir/detail/161839.html

Some analysts are saying that bankruptcy could be California's best bet for getting out from under a crushing budget deficit of 25 billion dollars.

But current U.S. law prohibits states from declaring bankruptcy, which is why some are pushing for a change.

This call for a change in the bankruptcy law comes as California's financial future looks even more bleak than it did the previous year.

The state's budget deficit continues to increase while the unemployment rate shows no sign of dropping.

Declaring bankruptcy could be the best path for the state to get out from under it's crushing debt and move toward recovery.

Economists say other California municipalities are already taking advantage of bankruptcy protection.

The city of Vallejo and Orange County both filed for bankruptcy and are emerging with an improved financial situation.

But economists say there's a big difference between a city and a state.

That's why California Treasurer Bill Lockyer is already dismissing the idea of filing for bankruptcy, saying it would limit the state's ability to create jobs and to secure future investments.

And economists say California already has the lowest credit rating in the U.S.

However, proponents of the bankruptcy option say it will give California leverage when dealing with the public employee unions.

The state has a massive unfunded pension liability and the threat of bankruptcy might encourage unions to agree to reduced packages.

But economists say bankruptcy would not address the main reason California is in fiscal turmoil.

Republicans are expected to introduce the bankruptcy legislation within the next 30 days.

Experts say even if the bill was passed, it would take at least two years before states would be able to file.

China taking over US banks

ICBC is doubling its presence in Europe through branch openings in major cities

Source: Press TV
http://www.presstv.ir/detail/161737.html


The Industrial and Commercial Bank of China (ICBC) has agreed on a deal to take over a US retail bank, at a time when American financial institutions are falling one after another.

The ICBC will buy 80 percent of the US unit of Bank of East Asia Ltd. for USD 140 million, the two companies announced in an e-mailed statement on Sunday.

The move, which is yet to be approved by US regulators, could be a positive step for the arrival of Chinese banks to the US retail market.

The deal was signed during President Hu Jintao's state visit to the US.

The acquisition “will enable us to establish a solid presence in the US,” ICBC Chairman Jiang Jianqing said in the statement.

“With this commercial bank license in the US, ICBC can further expand its retail banking business and operating network across the nation.”

In January, ICBC opened its first branch in Paris, and is doubling its presence in Europe through branch openings in major cities.

Over 10 percent of the 7,760 banks in the US are in financial trouble and despite receiving a total of USD 4.2 billion in bailout cash, 98 US banks are still at risk of failing.

In 2010, 157 US banks failed and so far this year seven banks have failed.