Self training

The global downturn appeared close to a bottom yesterday after manufacturing figures from across the world suggested the worldwide recession was running out of steam in all big economies.

The welcome news comes after nine months of the sharpest contraction in global manufacturing output since the second world war and a dramatic plunge in world trade as buyers of capital goods and consumer durables effectively went on strike.

Stuart Green, global economist with HSBC, said the signs from around the world indicated that “a spell in the financial wilderness now looks less likely for the major economies . . . with a slowly improving cyclical picture factored in for the rest of 2009 and 2010 across many regions”.

But he and policymakers around the world fear that the coming upturn will be neither durable nor strong.

The recovery in global manufacturing has come primarily because companies have sold off much of their accumulated stocks and are re-starting mothballed production lines. Once this temporary boost is completed, serious questions remain about the source of longer term demand to maintain the current momentum.

The June data yesterday came from a series of surveys of purchasing managers in the manufacturing sector, the area of the global economy hardest hit by the recession. Although the headline figures were positive only in China, the manufacturing output element of the data was positive in the US, the UK and Japan as well.

spell       咒语
wilderness      荒野
mothball     封存

Vladimir Putin yesterday told the heads of Russia's leading banks not to plan any summer holidays but to help overcome the steep recession by lending more – even as the country braces itself for a surge in bad loans.

The prime minister called on state banks to boost lending by up to $16bn (€11.4bn, £9.7bn).

VTB, the state-controlled second-biggest lender, said bad loans had already surged three times this year to 6 per cent of the total, and gave warning that it would face losses in 2009.

“I am asking the heads of financial institutions to control this situation and not to plan any summer holidays until the moment that this has been dealt with as it should,” Mr Putin told officials at a government meeting.

He said banks needed to lend more in order to break a cycle of fear that was threatening to paralyse the economy. “I know the fear . . . about the growth in bad loans. But I suggest that the less lending goes on, the greater the risk is that loans won't be returned, because by ceasing to credit, you are strangling the real economy,” the premier said.

Mr Putin signed off on a government order to provide 300bn roubles in additional state guarantees for loans that he said could boost lending, mainly by the top state banks, by up to 500bn roubles ($16bn).

surge    巨涌
strangle  扼死

The US economy continued to contract in the first quarter of this year, but at a slower pace than previously thought, official figures showed on Thursday.

Separately, the labour department said that new claims for unemployment benefits grew more than expected last week, offering a stark reminder that even as the economy turns around the stricken labour market could be slow to follow.

Revised commerce department figures revealed that US gross domestic product declined by an annualised rate of 5.5 per cent in the first three months of the year. That was better than economists expected and a smaller contraction than the original estimate of a 6.1 per cent contraction and last month's estimate of a 5.7 per cent decline.

Output is slowly beginning to rekindle in the US economy, which has been mired in its worst recession in the last 50 years. The first quarter result, while grim, was an improvement from the end of 2008 when GDP declined by 6.3 per cent, the steepest fall since 1982.

Economists expect to see more significant improvement in the second quarter of this year. On Wednesday the Federal Reserve said in its Federal Open Market Committee statement that economy activity was likely “remain weak for a time” but that sustainable economic growth would then resume gradually while inflation remains “subdued”. Meanwhile the Organisation for Economic Co-operation and Development improved its outlook for the US and predicted the economy would grow by 0.9 per cent next year.

stark        赤裸的
stricken    遭殃
rekindle    重新点燃
mire        陷入
grim        严酷
subdue      征服

Shares in Taipei rose almost 3 per cent yesterday to lead a broad rally in Asian stock markets after the island's government said it would send cabinet members to Beijing to discuss cross-strait financial ties.

Cathay Financial advanced 6.9 per cent to T$48.55 on hopes of better business with the mainland. Taishin Financial gained 6.17 per cent to T$12.05.

Taiwan Semiconductor Manufacturing, a maker of custom chips, rose 3.1 per cent to T$52.90 on optimism that demand for its electronic components would improve.

Overall, the weighted index closed 2.9 per cent higher at 6,380.08.

In Shanghai, the Composite index closed 1 per cent higher at a one-year closing peak of 2,922.30. The benchmark index has gained 60 per cent this year but is still more than 50 per cent down from the record high above 6,000 reached in October 2007.

The Hang Seng index in Hong Kong closed 2 per cent higher at 17,892.15 and the index of H shares of mainland companies listed in the territory rose 2.4 per cent to 10,530.35.

Angang Steel rose 5.3 per cent to HK$13.06 on reports that Asia's biggest iron-ore deposit had been discovered in the north-east of China.

China Overseas Land & Investment continued the rally started earlier in the week on news sales had gone up 80 per cent year on year in the first five months of 2009. The shares gained another 5 per cent to HK$16.96. Sun Hung Kai Properties rose 3.4 per cent to HK$92.15 and Sino Land was 3.6 per cent higher at HK$12.50.

Tencent, a technology company that operates China's instant message system QQ, gained 5.7 per cent to HK$90.05. The price target of the company was further lifted by Goldman Sachs and HSBC. The company is planning to list on the mainland Chinese market soon.

Shares in Russia dropped further yesterday, extending losses this month to more than 20 per cent in a sell-off that has underscored the country's record as one of the world's most volatile markets.

Russia's shares have led a slide across most emerging market assets this month as investor confidence weakens over the prospects of a global economic revival.

The FTSE All World Emerging index has fallen 9.7 per cent since it hit a peak on June 1. In contrast, Russia's dollar- denominated RTS index has tumbled 21 per cent since its peak on June 2 after a 2.94 per cent drop yesterday. The rouble-based Micex has fallen 24 per cent since its June 1 peak.

Investors said the slide had laid bare the structural problems facing the Russian economy. It faces the steepest economic decline of all the emerging markets in the Bric group – which includes Brazil, India and China – as well as the biggest debt restructuring problem.

Russia's economy is forecast by the World Bank to contract more than 7 per cent this year, while its companies and banks must repay $200bn in debts – domestic and foreign – in the next 12 months.

Russia's banking system has all but ceased lending due to growing fears about a second wave of financial crisis that could hit the banking sector later this year as non- performing loans grow.

sell-off        证券跌价
volatile    易蒸发的

Equities, commodities and emerging market currencies suffered hefty losses yesterday as risk averse investors shifted to the perceived safety of the dollar, the yen and government bonds.

“Risk aversion has resurfaced as market participants take profits on riskier exposures amid the World Bank's downward revision of its global growth forecast for 2009,” said Samarjit Shankar, director of global strategy at Bank of New York Mellon.

“Renewed concerns about the extent of the ongoing global recession and the sustainability of the ‘green shoots' of recovery have combined with the instability unfolding in Iran and North Korea to lend an air of pessimism to investor sentiment.”

The World Bank said it expected the global economy to shrink by 2.9 per cent this year, compared with a previous estimate of a 1.7 per cent contraction.

The cautious mood among investors was intensified by uncertainty ahead of this week's Federal Reserve policy meeting.

The downgrade overshadowed further signs of optimism from surveys of corporate sentiment in Germany and Japan.

Germany's Ifo institute said that its business climate index rose to 85.9 this month from 84.3 in May, ahead of expectations and the highest reading since November. The Ifo expectations index rose to 89.5 from 85.9, although the current conditions reading slipped from 82.5 to 82.4.

But Gabriel Stein at Lombard Street Research said it was hard not to worry that German companies may be expecting too much.

Meanwhile, leading manufacturers in Japan were much less pessimistic about business conditions in the three months to June as exports improved, according to the government's Business Outlook Survey.

The BOS report offered some support to Asian equity markets, with the Nikkei 225 Average in Tokyo edging 0.4 per cent higher and Hong Kong rising 0.8 per cent.

But there was a much more bearish tone in Europe and the US. The FTSE Eurofirst 300 index tumbled 2.8 per cent to its lowest close since mid-May, while by midday in New York, the S&P 500 was down 2.6 per cent and trading below its 200-day moving average.

Credit spreads widened sharply, with the Markit iTraxx Crossover index of mostly junk-rated credits rising 27 basis points to 765bp.

Commodity prices fell across the board, with oil sliding below $70 a barrel and copper falling to a three-week low. Gold eased 1.2 per cent to $920 an ounce.

hefty       heavy
resurface   重新露面
amid        in the middle of
overshadow 使失色
tumble      跌倒

The US Federal Reserve is considering dramatic changes to the giant “repo” markets where banks around the world raise overnight dollar loans – including creating a utility to replace the Wall Street banks that now handle transactions, people familiar with the matter say.

The Fed deliberations are partly motivated by concerns that the structure of the US overnight repurchase market may have exacerbated the financial turmoil that accompanied the failure of Lehman Brothers in September 2008.

Fed officials plan to meet next month with market participants to discuss potential reforms. People familiar with the Fed's thinking say it is looking into the creation of a new mechanism to replace the clearing banks – the biggest of which are JPMorgan Chase and Bank of New York Mellon – that serve as intermediaries between borrowers and lenders in the repo market.

“The Fed is raising questions about whether the system really protects the interests of all participants,” says one person familiar with the Fed's thinking.

In the repo markets, borrowers, such as banks, pledge collateral in return for overnight loans from lenders, such as money market funds. The clearing banks stand in between the parties, providing services such as valuing the collateral and advancing cash during the hours when trades are being made and unwound.

Fed officials are worried that this arrangement puts the clearing banks in a difficult position in a crisis. As the value of the securities they hold falls, clearing banks have an obligation to demand more collateral to avoid losses. But in doing so, they could destabilise a competitor.

deliberation   arising from or marked by careful consideration
exacerbate     to increase the severity, violence, aggravate
turmoil        a state of extreme confusion or agitation
collateral     Property acceptable as security for a loan or other obligation.
unwind         seperate parts of
advance           预付

President Barack Obama yesterday sought an extra $1.5bn (£1bn, €1.1bn) from Congress as the US sharply stepped up its response to the growing spread of swine flu from Mexico around the world.

He called for a substantial increase in funding to help build stockpiles of antiviral drugs, work on vaccines and strengthen international co-operation as other countries escalated measures against a likely global pandemic.

The US said the number of infections had risen to 64 across five states including likely transmission between people outside Mexico, while Israel and New Zealand also reported the first confirmed cases in Asia and the Middle East.

In a sign of tensions between national governments and international organisations, Japan cancelled visa-free travel to Mexico, and the US, the European Union and a number of other governments advised against non-essential travel to Mexico, despite advice from the World Health Organisation that it would do little to prevent spread of the virus.

Tensions between Moscow and Washington also intensified, with the US embassy in Moscow arguing there was “no evidence” to support a partial ban on American meat sparked by the outbreak, while a spokesman for the Russian veterinary watchdog said the US was “protecting the interests of their exporters”.

As concerns over a pandemic continued to affect the financial markets, Moody's estimated in a research note yesterday that the global macroeconomic impact of a mild flu pandemic could cost 1.4m lives and reduce global gross domestic product by 0.8 per cent or $330bn.

stockpile     积蓄，库存
vaccine       疫苗
veterinary    兽医
watchdoy      监管人员

Japan's government yesterday tore up its latest growth forecasts and instead predicted a record drop in output this year as it sought backing from the Diet for a fresh fiscal stimulus to revive the battered economy.

Tokyo said it expected gross domestic product to fall 3.3 per cent in the fiscal year that began April 1 and warned that the economic picture was worsening. The government had forecast in December flat growth for the current fiscal year.

“The Japanese economy is continuing to deteriorate rapidly,” Kaoru Yosano, finance and economics minister, told parliament. “Our country is clearly in a situation that can be described as an economic crisis.”

The downgrade in the government's 2009-10 forecast came in spite of a new fiscal stimulus package, which the cabinet office projects will raise output by 1.9 per cent. The package forms the largest part of the Y14,700bn ($152bn) supplementary budget.

The government, which estimated that the economy contracted by 3.1 per cent in the year that ended March 31, yesterday submitted bills that included tax breaks to encourage housing investment and a Y50,000bn emergency scheme to invest public money in the stock market.

tear tore
seek sought
battered  打扁了  VS butter
deteriorate   使恶化
parliament    国会，议会
cabinet        内阁
scheme        安排
the Diet        日本议会

Governments and health authorities worldwide went on the alert over the weekend for a possible influenza pandemic as the death toll from a new strain of swine flu in Mexico reached 81.

Janet Napolitano, homeland security secretary, yesterday declared a “public health emergency” in the US as about 20 people there were confirmed to have been infected, though none is seriously ill.

The World Health Organisation in Geneva declared “a public health emergency of international concern”.

Keiji Fukuda, WHO assistant director-general for health security, said its emergency committee would decide tomorrow whether to raise the official pandemic threat level above “phase three”, where it has been for several years in response to the threat from H5N1 bird flu in Asia.

A pandemic would seriously harm the prospects of the world economy recovering from recession, with the travel and leisure sectors particularly vulnerable – as the 2003 Sars outbreak showed. Authorities in several Asian countries were yesterday starting to screen travellers at airports and border crossings.

The Mexican authorities declared a state of alert in and around Mexico City, the sprawling capital, with about 20m inhabitants where the outbreak is centred. They cancelled all public events over the next few days, including ministerial speaking engagements, large-scale meetings, rock concerts in the city and even football matches. The Mexican Football Federation confirmed that yesterday's two big games in Mexico City would be played before empty terraces.

influenza    流行性感冒
pandemic    n流行性疾病    adj全国流行的
swine          猪
sprawling      蔓延
ministerial    部长级的
terrace    梯田的一层, 梯田, 房屋之平顶, 露台, 阳台, 倾斜的平地

Conflicting signals on the health of the global economy and the banking sector left US and European equities lower yesterday but failed to enhance the safety appeal of the dollar, the yen or government bonds.

The latest figures on eurozone manufacturing and service-sector activity beat expectations and provided an early boost to investor risk appetite as they helped offset the International Monetary Fund's cut to its growth forecast for the region.

“The first signs of improvement in the eurozone business cycle are starting to emerge,” said Marco Valli, economist at UniCredit.

“Today's data contain some clearly positive news, particularly in manufacturing, that make us more confident that we will see an easing in the pace of recession starting from the second quarter.”

Eurozone industrial orders declined in February, “but showed signs of stabilisation,” according to Barclays Capital.

The more positive view was further encouraged by better than forecast French business confidence data and a slightly better tone to the Confederation of British Industry's latest industrial trends survey.

Good news also came on the banking front as first-quarter profits at Credit Suisse easily beat expectations and Barclays of the UK pledged to resume dividend payments in the second half of this year.

Japanese investors managed to shrug off local press reports that Nomura would report a record annual loss due to the cost of buying up operations from collapsed investment bank Lehman Brothers.

But the more confident mood in Europe faltered as US labour and housing market data failed to impress. Continued jobless claims reached a fresh record high last week while sales of existing homes fell by 3 per cent last month.

“Sharply lower mortgage rates are still failing to convince people to step back into the housing market,” said Dimitry Fleming, economist at ING.

“These numbers will help to weaken the sense of stability that has recently emerged in the US housing market.”

The mood was also dented by a poor outlook statement from United Parcel Service – often seen as a bellwether of the US economy – and equity markets on both sides of the Atlantic turned lower.

By midday in New York, the S&P 500 was down 0.2 per cent, while the pan- European FTSE Eurofirst 300 index gave up an early advance to finish 0.4 per cent lower.

But Asian markets staged a modest rebound following recent losses. The Nikkei 225 Average rose 1.4 per cent, while Hong Kong climbed 2.3 per cent.

front  A field of activity    the ecnomic front
shrug off    轻蔑对待
buy up    全买
falter  To operate or perform unsteadily or with a loss of effectiveness
dent    Informal Meaningful progress; headway
bellwether   领导
parcel    包裹

China has said it will not join the growing trend of outsourcing food production by investing in overseas farmland, particularly in Africa, expressing doubts that such deals could improve its food security.

Niu Dun, China's deputy agriculture minister, said yesterday that Beijing preferred to depend on its own land to maintain self-sufficiency in grain, distancing the country from nations such as Saudi Arabia and South Korea, which are investing in land overseas.

“We cannot rely on [investments in] other countries for our own food security,” Mr Niu told the Financial Times in an interview at the Group of Eight's first meeting on agriculture. “We have to depend on ourselves,” he said in the first comments on the subject by a senior Chinese policymaker.

As the world's biggest agricultural economy and its largest consumer and producer of cereals, any decision by China to invest in African arable land would have large implications. But Mr Niu rejected any move in that direction. “We are in a different situation to other countries, for example South Korea,” he said.

The pursuit of foreign farmland signals how countries are seeking to boost their food security after last year's spike in agricultural commodities prices and trade restrictions led them to believe they could not rely on the global food market.

China's comments were made as the World Bank told the FT on the sidelines of the conference that it planned to publish a code of conduct for investing in overseas farmland as soon as next month. It wants to “avoid pitfalls” in what a senior bank official described as a “quite significant” new investment trend.

cereal    谷物
arable 可耕的, 适于耕种的
spike    峰值
pitfall    缺陷
signal    动词
code     A systematic collection of regulations and rules of procedure or conduct
conduct  （名词）行为, 操行

President Barack Obama and Federal Reserve chairman Ben Bernanke yesterday voiced wary optimism that the US economy is no longer in freefall, even as new data showed retail sales fell in March.

In a speech at Georgetown University, Mr Obama reiterated that he detected “glimmers of hope” in the economy. He said the $787bn stimulus, the $700bn bank recapitalisation programme, $70bn housing plan and extra federal aid to Detroit auto-companies were “starting to generate signs of economic progress”.

Meanwhile, Mr Bernanke said: “We have seen tentative signs that the sharp decline in economic activity may be slowing.” He added that “a levelling out of economic activity is the first step toward recovery” – though he did not say when he thought this levelling out would take place.

The comments by Mr Obama and Mr Bernanke underscore a shift in US official rhetoric, with policymakers now prepared to draw attention to the slowing in the rate of economic decline.

In a speech late last week, Lawrence Summers, director of the National Economic Council, said the “sense of freefall” will be over within the next few months.

However, while top officials in both the US administration and central bank think the economy will probably bottom out in the second half of this year, they remain wary of calling the turn in the economic cycle.

They regard recent signs of green shoots as hopeful but far from definitive, and do not want to undermine support for continued extreme fiscal and monetary measures that may still be needed to support growth. March retail sales figures released yesterday raised questions as to whether US consumer spending has yet found a floor following a sharp plunge in late 2008. Sales fell 1.1 per cent from February, with declines in every category apart from food and health.

Mr Bernanke said “we will not have a sustainable recovery without a stabilisation of our financial system and credit markets” – though he said “we are making progress on that front.”

Offering his lengthiest defense of his administration's handling of the crisis to date, Mr Obama rebuffed criticism that it was running excessively large deficits, saying the “last thing a government should do in the middle of a recession is to cut back on spending”.

wary          机警 Characterized by caution
reiterate    重申
glimmer     A dim or intermittent flicker or flash of light
tentative    试验性
rhetoric       修辞、申诉
undermine    破坏
lengthy      冗长
rebuff       回绝

Prices in the US fell in the year to March, marking the first annual decline since 1955 and easing fears that aggressive government stimulus measures could kick-start inflation.

The drop in prices could ease pressure on consumers who have seen their wealth savaged by the economic downturn, but companies remain under severe pressure to cope with eroding demand.

Official figures revealed separately yesterday showed industrial production plunging 12.8 per cent in the year to March while manufacturing output fell at the fastest rate since the end of the second world war.

Consumer prices were down by 0.4 per cent year-on-year, the labour department said yesterday. Last month prices fell 0.1 per cent owing to weak energy and food prices following two months of increases.

The monthly figure trailed the 0.1 per cent rise economists had expected and compared with a 0.4 per cent increase in February.

The drop in prices could renew fears of deflation, which were stoked after prices were flat or declined during the final five months of 2008. As the economic recession deepened in the second half of last year companies slashed prices to clear stocks.

eroding    磨蚀，耗掉
stoke        To feed fuel to and tend the fire of (a furnace)   VS stock
slash        大量削减

South Korea, Indonesia and the Philippines yesterday set out pessimistic forecasts for 2009 exports, underscoring the continued gloom about economic prospects.

South Korea, Asia's fourth largest economy, said it expected exports to fall 13.5 per cent during the year, a sharp revision from a bullish rise of 1.1 per cent forecast in December.

Seoul also revised down export figures in March, saying shipments fell by 22 per cent and not the 21.2 per cent initially estimated.

“There are some positive signs, but I believe we still stand somewhere in the middle of a long tunnel,” said Lee Myung-bak, the president.

Sri Mulyani Indrawati, Indonesian finance minister, said that she expected her country's total exports to contract 30 per cent this year.

“Global demand will shrink as countries which import from Indonesia are cutting their consumption. It is important now to optimise the domestic market as the prime mover for economic growth,” she said.

The Philippines, meanwhile, revised its forecast for exports to a decline of 13-15 per cent, roughly double the previous predicted range of 6-8 per cent.

“The world economic situation was much worse than we expected,” said Gil Beltran, an undersecretary at the department of finance, at the end of a meeting of top policymakers to review the country's fiscal targets and economic prospects.

Factoring in the worsened export picture, Manila trimmed its forecast for economic growth for 2009 to 3.1-4.1 per cent, down from 3.7-4.4 per cent. Next year's target range was reset at 4.3-5.3 per cent from 4.9-5.8 per cent.

The Philippines reported that exports in February fell by 39.1 per cent from a year earlier. It was the fifth month of sharp declines in the country's overseas shipments, which make up almost two-fifths of the economy.

Later in the day the central bank cut its benchmark interest rate by 25 basis points. The government, meanwhile, said it was prepared to see its budget deficit soar to a five-year high of 199.2bn pesos ($4.2bn, €3.2bn, £2.8bn) to soften the impact of the economic downturn.

The deficit, equivalent to 2.5 per cent of gross domestic product, is more than double last year's deficit of 68.9bn pesos.

underscore        强调
gloom            darkness   VS boom
undersecretary        vice secretary
trim             revise

The US trade gap plunged by 28.3 per cent in February to $26bn, the lowest level in nearly 10 years as Americans' once voracious demand for the world's goods continued to collapse.

The monthly decline was the sharpest since September 1996 and was pulled down by declining imports of goods and services, which fell for the seventh consecutive month, dropping by 5.1 per cent to $152.7bn from $160.9bn in January. Exports rose by $2bn, or 1.6 per cent, the first increase since last July, commerce department figures showed on Thursday.

The rise in US exports was fuelled by increases in sales of consumer goods, cars and parts. The fall in imports was due to weaker demand for industrial supplies and capital goods. On the year in February exports are off by 16.9 per cent and imports are down by 28.8 per cent.

The figures surprised analysts' who on average were expecting the trade gap to remain flat at $36bn, previously a six-year low.

“This is potentially a very big deal,” said Alan Ruskin, strategist at RBS Greenwich Capital. “This does suggest that global rebalancing has taken another big step forward.”

voracious     贪婪的
commerce    商业
part        零件

US and European equity markets ran into profit- taking yesterday following last week's strong gains as investors continued to weigh up the prospects for the global economy.

Jan Loeys, global head of market strategy at JPMorgan, said that while economic news had not been good, the “seeds of a recovery” were starting to sprout.

He said the global consumer had not been pushing up the savings rate in recent months, was continuing to spend and this will induce producers to start restocking by the summer. “We thus retain our view that both the US and world economy will stop contracting by the middle of the year,” he said. “Most market participants are not expecting a recovery until year-end, and will thus likely be forced to cover steadily their defensive positions. Hence our overweight positions in equities and credit.”

profit-taking        获利回吐
weigh up         估量
sprout            萌芽

Taiwan yesterday posted a seventh consecutive month of falling exports, but at a slower rate of decline thanks to stronger demand from China.

The Taiwanese trade data came as the World Bank underlined the importance of Chinese demand in its latest assessment of the region's economies. While there were “signs that the strongest economy in the region, China, is beginning to turn the corner”, the bank cautioned that “a sustainable [east Asian] recovery will ultimately depend on developments in the advanced economies”.

In Taiwan, March exports fell by a third compared with a year ago, the finance ministry said. Nonetheless, the $15.5bn (€11.5bn, £10.5bn) of goods shipped was the highest in four months and nearly 24 per cent more than in February. “Exports were slightly boosted by rush orders after the Chinese New Year and by the replenishment of inventory,” the ministry said.

Recent consumer demand from China, spurred by Beijing's stimulus measures, has provided some relief to Taiwanese companies. China accounted for 40 per cent of Taiwan's exports last month, compared with 30 per cent at the beginning of the year.

consecutive    连续的, 联贯的
underline    强调
replenishment    补给, 补充

Somali pirates yesterday launched one of their most audacious attacks by hijacking a US-flagged ship with its 20 American crew.

It was the first time Somali pirates have seized US citizens since attacks from the east African country began to proliferate last August, according to the US navy.

The Pentagon said last night that the crew had retaken the vessel from the hijackers, but John Reinhart, chief executive of Maersk Line, the subsidiary of Denmark's AP Moller-Maersk that owns the ship, declined to comment on what he described as speculation about the situation.

In November, after the Saudi-owned oil tanker Sirius Star was hijacked, there were immediate reports that the crew had regained control. But these turned out to be false.

The Maersk Alabama was taken 350 nautical miles off Somalia's east coast as it made its way between the Kenyan port of Mombassa and Djibouti, at the mouth of the Red Sea. All 401 containers on board contained food aid for Somalia.

audacious ['ei]    大胆的，放肆的
proliferate    激增
nautical    船员的, 船舶的, 海上的, 航海的, 海军的
container    集装箱

US and European equity markets regained their poise yesterday to end the month with a flourish as risk appetite recovered in spite of generally gloomy reports on the global economy.

“Monday's equity sell-off seems to have been generally forgotten as global markets stabilise and currencies show a much more optimistic view of the world,” said Sacha Tihanyi, currency strategist at Scotia Capital.

He said the combination of a weak dollar and yen with higher commodity currencies – despite muted performances by oil and gold – depicted a clear lessening of risk aversion. “Market participants continue to eagerly anticipate the opportunity to enter into risk trades.”

The more optimistic mood came in spite of worse than expected figures in the US on house prices, consumer confidence and business activity in the mid-west region.

poise        平衡
gloomy        Marked by hopelessness; very pessimistic
sell-off    证券跌价
depict        描述

Foreign investors in Chinese banks will in future be forced to accept a lock-up period of at least five years, China's top banking regulator said, after a series of share sales by US and European financial institutions.

In recent months, companies such as Bank of America, UBS and Royal Bank of Scotland have sold down all or part of their stakes in China's largest state-owned banks immediately after three-year lock-up periods expired.

The new five-year minimum lock-up period was necessary to “ensure the safety of China's banking system”, Liu Mingkang, chairman of the China Banking Regulatory Commission, told a seminar in Beijing, according to people familiar with the matter and also state media reports.

Mr Liu also said Beijing would not reconsider current ownership limits for Chinese banks, which restrict single foreign investors to a 20 per cent holding and all foreign investors to no more than a combined 25 per cent stake in any Chinese bank.

The Chinese regulator decided last year not to allow a higher level of foreign involvement in domestic institutions.

That decision had not been publicly acknowledged until now and could affect the strategy of the few foreign banks that still have the ability and appetite to expand their presence in China.

Chinese companies are building $7bn of power plant equipment for customers in India, in a business that is underpinning growing trade between Asia's second and third largest economies.

Chinese producers are processing orders from India for 20,000 megawatts of boilers, turbines and generators, the main equipment in a power station, according to Lloyd's Register, which provides third-party assurance certification services for the power business.

“India and China both need each other for growth. There's huge demand on the Indian side and there's huge supply available on the Chinese side – and that is creating a big opportunity for trade,” said Swamina- than Krishnaswamy, vice- president for India chemicals and power and Sino-India business development at Lloyd's Register.

The main Chinese suppliers include Shanghai Electric, Dongfang Electric and Harbin Electric. Indian buyers include industrial groups Reliance, Essar, Adani, KSK Industries, JSW Energy and Jindal Steel & Power.

Bilateral trade between India and China has grown rapidly. It was forecast to reach $20bn last year from just $1.2bn in 1995 and is targeted to double to $40bn by 2010.

The power equipment business shows that differences between the Chinese and Indian development models can lead to trade helping both weather the economic downturn.

While India has specialised in services exports, excelling in industries such as information technology outsourcing, China has developed an unparalleled ability to roll out big-ticket infrastructure to support its huge trade in merchandise exports.

As India becomes more prosperous and seeks to create more manufacturing jobs for its vast pool of unskilled labour, it urgently needs to upgrade its infrastructure.

In the power sector, however, India's main producer of boilers and other large equipment, Bharat Heavy Electrical, has been overwhelmed with orders.

It has capacity for only about 10,000 MW of power equipment a year compared with the government's target for the five years ending 2012 to build power plants with capacity of 78,000 MW, forcing India to look to China to help fill the gap.

Another reason many Indian groups are buying Chinese power equipment is that they are able to deliver much more quickly than indigenous groups.

Chinese producers can deliver equipment for a 4,000 MW facility in about 18 months, up to 30 per cent quicker than their Indian counterparts.

This is important when India is facing an annual power deficit between output and demand of about 9-13 per cent.

underpin    加强...的基础, 巩固, 支撑
megawatt    mega 兆  watt 瓦特
boiler        锅炉
turbine        涡轮
bilateral    双边
big-ticket    having a high price or cost
indigenous    本土的

Switzerland's private banks have started to ban their top executives from travelling abroad, even to neighbouring France and Germany, because of fears they will be detained as part of a global crackdown on bank secrecy.

The head of one leading private bank in Geneva said the growing determination of countries such as the US and Germany to tackle tax evasion and secrecy meant banks felt they had to take extra measures to protect employees.

“Some banks have taken this precaution,” he said. “If today I go to Germany to visit two banks I deal with . . . German customs can take me in and question me.”

The travel bans, which have not been brought in by all banks, have focused on those visiting the US, following the detention there last year of a senior private banker from UBS, Switzerland's biggest bank, as part of a federal tax investigation.

detain        拘留, 留住, 阻止
crackdown    压迫, 镇压, 打击
secrecy        secrecy is the practice;secret is the content
tackle        固定, 应付(难事等), 处理, 解决, 抓住
evasion        逃避, 借口
mean        To have as a consequence; bring about 造成：作为结果而具有；引起
detention    拘留, 禁闭, 阻止, 滞留

Japanese exports have nearly halved from a year ago, official figures showed yesterday, stoking fears that the world's second largest economy is heading even deeper into recession.

The country's dismal February trade performance was the latest in a string of bleak economic figures. It fuelled expectations that Japan was on course to suffer a steep fall in output in the first three months of 2009 that could match or even exceed the 3.2 per cent quarter-on-quarter decline recorded in the final three months of last year.

Japan, which is highly dependent on exports for growth, achieved a slim trade surplus of Y82.4bn ($844m) last month, after suffering a record deficit of more than Y950bn in January.

However, it did so only because of a record 43 per cent drop in imports to Y3,443bn. That fall underscored the nation's fast diminishing appetite for raw materials and weakening domestic consumer demand.

Exports fell 49.4 per cent year-on-year to Y3,525bn, their worst performance since Japan began keeping comparable trade statistics in 1980.

halve    To lessen or reduce by half
stoke    To feed fuel to and tend the fire of (a furnace)
dismal    Causing gloom or depression; dreary:
bleak    寒冷的, 阴冷的, 荒凉的, 凄凉的, 黯淡的
underscore    划线于...下, 强调
diminishing    逐渐缩小的

The IMF is to overhaul its lending facilities in an attempt to propel more money into emerging market countries and lessen the stigma attached to tapping the fund.

Spurred into action by growing strain in emerging markets and calls from the G20 for the fund to take a bigger role in the crisis, the IMF said yesterday it would bring in a new lending facility and modify the conditions and repayment structure for its other loans.

The new “flexible credit line” facility would act like an insurance policy: countries would sign up to the fund for a fee, but only choose to access money when they needed it. The IMF wants the facility to be largely preventative, encouraging countries to draw on its money early rather than waiting until a full-blown crisis drives them into the hands of the lender of last resort.

It is aimed at essentially strong and well-run emerging market economies suffering as exports drop and external financing dries up.

There has been deep reluctance among such countries, especially in Asia and Latin America, to turn to the IMF for help because of fears the news would spark market panic.

The IMF's last attempt to help these countries was soundly rebuffed. Its “short-term liquidity facility” (SLF) has failed to attract a single borrower since its launch last year, and is now being shut down.

overhaul  改革
stigma    污名
spur     刺激

rebuff   回绝

Do Facts Matter?

By Thomas Sowell

Abraham Lincoln said, "You can fool all the people some of the time and some of the people all the time, but you can't fool all the people all the time."

Unfortunately, the future of this country, as well as the fate of the Western world, depends on how many people can be fooled on election day, just a few weeks from now.

Right now, the polls indicate that a whole lot of the people are being fooled a whole lot of the time.

The current financial bailout crisis has propelled Barack Obama back into a substantial lead over John McCain- which is astonishing in view of which man and which party has had the most to do with bringing on this crisis.

It raises the question: Do facts matter? Or is Obama's rhetoric and the media's spin enough to make facts irrelevant?

Fact Number One: It was liberal Democrats, led by Senator Christopher Dodd and Congressman Barney Frank, who for years- including the present year- denied that Fannie Mae and Freddie Mac were taking big risks that could lead to a financial crisis.

It was Senator Dodd, Congressman Frank and other liberal Democrats who for years refused requests from the Bush administration to set up an agency to regulate Fannie Mae and Freddie Mac.

It was liberal Democrats, again led by Dodd and Frank, who for years pushed for Fannie Mae and Freddie Mac to go even further in promoting subprime mortgage loans, which are at the heart of today's financial crisis.

Alan Greenspan warned them four years ago. So did the Chairman of the Council of Economic Advisers to the President. So did Bush's Secretary of the Treasury, five years ago.

Yet, today, what are we hearing? That it was the Bush administration "right-wing ideology" of "de-regulation" that set the stage for the financial crisis. Do facts matter?

We also hear that it is the free market that is to blame. But the facts show that it was the government that pressured financial institutions in general to lend to subprime borrowers, with such things as the Community Reinvestment Act and, later, threats of legal action by then Attorney General Janet Reno if the feds did not like the statistics on who was getting loans and who wasn't.

Is that the free market? Or do facts not matter?

Then there is the question of being against the "greed" of CEOs and for "the people." Franklin Raines made $90 million while he was head of Fannie Mae and mismanaging that institution into crisis.

Who in Congress defended Franklin Raines? Liberal Democrats, including Maxine Waters and the Congressional Black Caucus, at least one of whom referred to the "lynching" of Raines, as if it was racist to hold him to the same standard as white CEOs.

Even after he was deposed as head of Fannie Mae, Franklin Raines was consulted this year by the Obama campaign for his advice on housing!

The Washington Post criticized the McCain campaign for calling Raines an adviser to Obama, even though that fact was reported in the Washington Post itself on July 16th. The technicality and the spin here is that Raines is not officially listed as an adviser. But someone who advises is an adviser, whether or not his name appears on a letterhead.

The tie between Barack Obama and Franklin Raines is not all one-way. Obama has been the second-largest recipient of Fannie Mae's financial contributions, right after Senator Christopher Dodd.

But ties between Obama and Raines? Not if you read the mainstream media.

Facts don't matter much politically if they are not reported.

The media alone are not alone in keeping the facts from the public. Republicans, for reasons unknown, don't seem to know what it is to counter-attack. They deserve to lose.

But the country does not deserve to be put in the hands of a glib and cocky know-it-all, who has accomplished absolutely nothing beyond the advancement of his own career with rhetoric, and who has for years allied himself with a succession of people who have openly expressed their hatred of America.

-----

另一篇相关文章：

Deregulation Not to Blame for Financial Woes

By Peter Wallison

The Democrats are wrong in claiming that financial services deregulation is to blame for the current financial crisis-if anything, the financial sector has seen increased regulation since the savings and loan collapse in the 1980s. The lax supervision of Fannie Mae and Freddie Mac, which Republicans sought to strengthen in 2005, is the true culprit of this financial crisis.

In the debate on September 26, Democratic presidential nominee Barack Obama argued that the current crisis in the financial markets is the result of Republican deregulation.

The advertising from his campaign has been saying the same thing, and this claim is becoming a fixed element in the talking points of Democratic candidates this year.

The credibility of the charge depends on ignoring several important facts:

- There has been a great deal of deregulation in our economy over the last 30 years, but none of it has been in the financial sector or has had anything to do with the current crisis. Almost all financial legislation, such as the Federal Deposit Insurance Corp. Improvement Act of 1991, adopted after the savings and loan collapse in the late 1980s, significantly tightened the regulation of banks.

- The repeal of portions of the Glass-Steagall Act in 1999-often cited by people who know nothing about that law-has no relevance whatsoever to the financial crisis, with one major exception: it permitted banks to be affiliated with firms that underwrite securities, and thus allowed Bank of America Corp. to acquire Merrill Lynch & Co. and JPMorgan Chase & Co. to buy Bear Stearns Cos. Both transactions saved the government the costs of a rescue and spared the market substantial additional turmoil.

None of the investment banks that got into financial trouble, specifically Bear Stearns, Merrill Lynch, Lehman Brothers Holdings Inc., Morgan Stanley and Goldman Sachs Group Inc., were affiliated with commercial banks, and none were affected in any way by the repeal of Glass-Steagall.

It is correct to say that there has been significant deregulation in the U.S. over the last 30 years, most of it under Republican auspices. But this deregulation-in long-distance telephone rates, air fares, securities-brokerage commissions, and trucking, to name just a few sectors of the economy where it occurred-has produced substantial competition and innovation, driving down consumer costs and producing vast improvements and efficiencies in our economy.

The Internet, for example, wouldn't have been economically possible without the deregulation of data-transfer rates. Amazon.com Inc., one of the most popular Internet vendors, wouldn't have been viable without trucking deregulation.

- Republicans have favored financial regulation where it was necessary, as in the case of Fannie Mae and Freddie Mac, while the Democrats have opposed it. In 2005, the Senate Banking Committee, then under Republican control, adopted a tough regulatory bill for Fannie and Freddie over the unanimous opposition of committee Democrats. The opposition of the Democrats when the bill reached the full Senate made its enactment impossible.

Barack Obama did nothing; John McCain endorsed the bill in a speech on the Senate floor.

- The subprime and other junk mortgages that Fannie and Freddie bought-and the market in these mortgages that their buying spawned-are the underlying cause of the financial crisis. These are the mortgages that the Treasury Department is asking for congressional authority to buy. If the Democrats had allowed the Fannie and Freddie reform legislation to become law in 2005, the entire financial crisis might have been avoided.

Policies that center on deregulation are probably hard for the voting public to grasp, and that has allowed Democratic candidates to spread the idea that there is a connection between deregulation and the current crisis. But an Obama victory, based in part on the claim that deregulation has caused the financial crisis, will create a mandate for new regulation where it isn't necessary and will do harm to our economy.

bailout A rescue from financial difficulties
propel To cause to move forward or onward.=push
rhetoric 花言巧语的
spin To tell, especially imaginatively
lynching 处私刑
depose 免职
glib 口齿伶俐的, 油腔滑调的
hatred 憎恨, 乱意, 仇恨
woe Misfortune; calamity
culprit One guilty of a fault or crime
repeal 废除, 撤销
turmoil 骚动, 混乱
underwrite 认购
auspice 赞助, 支持、预兆, 前兆
commission 佣金
endorse To give approval of or support to, especially by public statement; sanction:
spawn To give rise to; engender
mandate Law

The dollar and sterling plunged and government bond yields in the US and Europe fell to multi-decade lows as investors tried to digest the implications of the Federal Reserve's new near-zero interest rate policy.

The US currency suffered its biggest one-day slide against the euro since the birth of the single European currency in January 1999 as the euro jumped from under $1.40 to above $1.44.

The yen powered higher, dragging the dollar to a 13-year low of nearly Y87 despite speculation that Tokyo could intervene to limit the rise in its currency and calls for the Bank of Japan to act more aggressively.

Following the Fed meeting on Tuesday, which reduced interest rates to a range of zero to 0.25 per cent, US rates are now lower than those in Japan for the first time since 1993.

The US currency has now given up a significant chunk of the gains it made in September and October as the credit crisis escalated and there was a global surge in demand for dollar liquidity and a flight for safety in US Treasury bonds.

Expectations that the Bank of England would cut rates more aggressively than the European Central Bank and could even follow the Fed into unorthodox territory sent the pound tumbling nearly 3 per cent to £0.9257 against the euro, a record low.

In the US, investors flocked to longer dated bonds, buoyed by the Fed statement that it is evaluating plans to buy Treasuries. The Fed also said it stood ready to increase its plans for hefty purchases of mortgage debt.

----From FTchinese

sterling 银币，英币，不是先令，先令是schiling，是奥地利货币
yen 日圆
chunk 【Informal】 A substantial amount: part
surge 上升
flight (鹰等对猎物的)追赶; (候鸟等的)迁徙
treasury 财政部 国库 Treasury bond国库券,单独也可以作此意思
unorthodox 非正统的, 异教的, 异端的
flockflock 聚结
buoy 使浮起, 支撑, 鼓励

One of the world's key shipping markets has begun to recover from a slump, with a revival in Chinese demand for iron ore and coal pushing some average charter prices up almost threefold in the past week.

The revival in prices, after a disastrous six months for the industry in which charter rates fell nearly 99 per cent for the largest vesssels, could encourage shipowners to bring mothballed vessels back into service.

One participant said yesterday that some owners were able to charge enough to cover the costs of operating Capesize ships, the largest dry bulk carriers. Average rates for these ships, which move coal and iron ore, have nearly tripled over the past week.

However, smaller ships have yet to show the same recovery as Capesize vessels.

Average spot rates, or the cost of carrying a single cargo immediately, finished the week at $8,261 a day for Capesizes, according to figures from Pareto Dry Cargo, an Oslo shipbroker.

The previous week's average was $2,763, one of the lowest yet seen. Pareto reported a long-term charter of a Capesize ship at $17,500 a day for a year, more than the daily basic operating costs of such a ship. Long-term charter rates are, unusually, higher than those in the spot market because of expectations that the spot market will recover.

Mark Richardson, head of futures at London-based Simpson, Spence & Young ship¬brokers, said the rise in prices was in part due to iron ore moving from Brazil and Australia to China. China had halted iron ore imports and relied on stockpiles because of falling steel demand and a dispute over prices with Brazilian producers.

The return of mothballed ships to the market could lead to a repeat of the over-supply which, combined with disappearing demand for coal, iron ore and wheat, depressed prices this year.

ore 矿石
charter 租船费
threefold 三倍
mothball 束之高阁
Capesize 好望角型，船一般分为以下几种：

巴拿马型散货船（Panamax bulk carrier）：顾名思义，该型船是指在满载情况下可以通过巴拿马运河的最大型散货船，即主要满足船舶总长不超过274.32米，型宽不超过32.30米的运河通航有关规定。根据需要，调整船舶的尺度、船型及结构来改变载重量，该型船载重量一般在6－7.5万吨之间。 运送大豆的就是这种船

好望角型散货船（Capesize bulkcarrier）：指载重量在15万吨左右的散货船，该船型以运输铁矿石为主，由于尺度限制不可能通过巴拿马运河和苏伊士运河，需绕行好望角和合恩角，台湾省称之为"海岬"型。由于近年苏伊士运河当局已放宽通过运河船舶的吃水限制，该型船多可满载通过该运河。

灵便型散货船（Handysize bulk carrier）：指载重量在2－5万吨左右的散货船，其中超过4万吨的船舶又被称为大灵便型散货船（Handymax bulk carrier)。众所周知，干散货是海运的大宗货物，这些吨位相对较小的船舶具有较强的对航道、运河及港口的适应性，载重吨量适中，且多配有起卸货设备，营运方便灵活，因而被称之为"灵便型"。

大湖型散货船（Lake bulk carrier）：是指经由圣劳伦斯水道航行于美国、加拿大交界处五大湖区的散货船，以承运煤炭、铁矿石和粮食为主。该型船尺度上要满足圣劳伦斯水道通航要求，船舶总长不超过222.50米，型宽不超过23.16米，且桥楼任何部分不得伸出船体外，吃水不得超过各大水域最大允许吃水，桅杆顶端距水面高度不得超过35.66米，该型船一般在3万吨左右，大多配有起卸货设备。

spot 现货
stockpile 和stock的意思差不多，但偏向于原料储备，多了一层精心的意思在里面

Angela Merkel, the German chancellor, turned the tables on her international critics yesterday by accusing the US and other governments of making "cheap money" a central tool of their economic management, thus planting the seeds of a similar crisis in five years.

"Excessively cheap money in the US was a driver of today's crisis," the chancellor told the German parliament. "I am deeply concerned about whether we are now reinforcing this trend through measures being adopted in the US and elsewhere and whether we could find ourselves in five years facing the exact same crisis."

It is the first time Ms Merkel has confronted her critics head-on. There have been calls from outside the country for Germany to beef up its fiscal support to the economy, in part because its vast current account surplus and healthy public finances give it more room for manoeuvre than other European nations.

Yet Ms Merkel has been wary of raising public borrowing to stimulate demand. She fears the extra income could boost Germans' already high savings rate while physical bottlenecks may prevent massive rises in infrastructure budgets being spent.

The chancellor defended her government's modest fiscal stimulus - worth €12bn ($15.6bn, £9.6bn) over the next two years - as a "measured and proportional response . . . tailored to the situation in the federal republic".

Her counter-offensive reflects impatience in Berlin at criticism from abroad. Moves this week - such as the US Federal Reserve's $800bn pledge to support lending, and the UK's economic stimulus involving an increase in borrowing - are raising concern in Germany that both countries may not be drawing the right lessons from a crisis originally triggered by reckless lending.

Steffen Kampeter, the budget expert in Ms Merkel's Christian Democratic Union in parliament and confidant of the chancellor, told the FT: "I see the danger of creating a new bubble. Massive interest rate cuts and massive borrowing may bring about new problems."

Mr Kampeter also attacked what he called "hectic" crisis-management in the US, Britain and France: "How good is a policy package if it has to be changed every other week? How good is it for confidence? The latest British decisions on VAT and income tax, for instance, are inconsistent. Better to wait a bit longer and put forward more durable solutions."

chancellor The chief minister of state in some European countries. VS counsellor attorney
turned the tables 扭转局面，转败为胜
parliament 国会, 议会
head-on 正面的
beef up [口]加强, 补充(人数, 兵力)等
fiscal 财政的, 国库的, 会计的, 国库岁入的
manoeuvre 策略, 调动
wary 机警的
massive 大块的
confidant 心腹朋友, 知己
hectic 兴奋的, 狂热的,

A drive to attract Chinese companies to London has received expressions of interest from three times the number it had targeted.

Think London, the inward investment agency, said the number of Chinese companies eager to set up an office in London as a stepping stone to Europe and Africa was higher than ever before in spite of the international economic downturn.

The agency had set a target of 30 positive leads from a three-month promotional roadshow in China. But 95 companies registered a strong interest and allocated a budget to establish a base in London within two years. Of those, nine are already working to set up in the capital within 12 months.

Michael Charlton, chief executive, said: "Chinese companies' interest in setting up operations in London has far and away exceeded our expectations."

However, he accepted that tough economic conditions would mean that inward investment would be hit next year. "Clearly, of the 95, some companies will fall away." he said. "The challenge now is to turn strong interest into reality."

Think London is on track to meet its foreign direct investment targets this year as most of the commitments were made before the full force of the credit crunch was felt. But Mr Charlton said: "It looks positive but I would be kidding myself if I didn't say 2009-10 was going to be challenging."

Chinese companies, which were well capitalised and did not need to rely on debt for expansion, realised that now was a good time to invest in London to take advantage of the weak pound and softening property prices, he said. In addition, a third of the interested companies had been sponsors or suppliers to the Beijing Olympics and were keen to take advantage of London 2012.

---From FTchinese

crunch 压碎, 扎扎地踏过