22/09/2011 World Business Report

and Iraq border and sentenced last month to eight years. Those are the

latest headlines. It is now time A warm welcome. This is World

Business Report. The headlines: The Fed fails to reassure investors its

latest plan to revive the economy with a big sell-off on Wall Street.

The board of UBS bank has lost confidence in its chief executive.

This is following its multi-billion dollar trading loss.

Plus, a status update from Facebook as it tries to cash in on its

popularity. But can it make money The markets continues despite

attempts by the Federal Reserve to restore confidence. A 400 billion-

dollar plan to boost the US economy was met last night with the biggest

sell-off on Wall Street in one month. US stocks ended 3% lower. In

Asia, shares are also we will look at the latest in a moment. But

first, we go to Washington on the Fed's latest move.

The men and women inside this building have been responsible for

some pretty novel ways of stimulating the US economy. But

with the end of their massive bond buying programme and with short-

term interest rates already near- zero, the Fed was in need of new

tricks. That is where Operation Twist comes in. So, how does it

work? They plan to sell some of their short-term bonds and replace

them with up to $400 billion worth of longer term bonds. In this case,

US Treasury bonds range from between six and 30 years. If it

works according to plan, it should bring down long-term interest rates

and in turn encourage people to borrow more and spend more. The

long-term interest rates are at lower levels. That helps support

the economy but it is no silver bullet. There are critics both

inside and outside this building. They say that there is in danger of

stoking inflation. And across town, the IMF is warning that low

interest rates for a very long period of time could be fuelling

the next bubble. That is an explanation of what it

means and what the risks are. Let's look at how the markets reacted. In

the US, there was a thumbs down when they thought to be

implications and the effectiveness of Operation Twist. In Asia, a

similar response. Japan is down 2%. Hong Kong has been hit hard.

Hong Kong has been hit hard. Similar in the Chinese market. The

US dollar is going up a tab. Shares Michelle outlined some of the

issues. We want this to work desperately but there are a lot of

debate -- there is a lot of debate as to whether it will work. Yes.

Everybody wants success and they want the recovery to be fostered by

these measures. The phrase, no silver bullet, that will be carted

across financial markets all day today. It is no silver bullet. Also,

the other problem, it could be argued as such, is the measures

were widely tried. And widely anticipated. So in that instance,

they are not a surprise. At the same time, they are coming against

the backdrop of the IMF downgraded growth expectations. And

downgrading some banks. So it is a negative said of news and that his

impact in the market. What has Ben Bernanke he had to say? There are

significant downside risks to the economic outlook. In their

statement last month, they said there were risks but not a

significant downside. That is a change of tone from the Fed. Yes.

They have to acknowledge the global environment has deteriorated. Not

only in the US, but also issues related to the debt ceiling and how

close the US got to some kind of the fault. Uncertainties there. And

on the other side of the equation, you have the eurozone which is a

difficult scenario. So the two big economic blocks under real economic

stress. It would be disingenuous to say anything other than it is

significant. We have not got much time. But in a nutshell, what is

your outlook? There is very little to get excited about at the moment

in the global economy, apart from what is happening in China. But we

have to remember we are still in a volatile environment. We are

probably still seeing growth and that is what we have to accept. We

are in a slower growth environment. For many, it will still feel like a

recession. How long? Probably the next two or three years where we

will have slower growth. It will be very tough. But you have to

remember how long it took us to get to the peak of the economic bubble.

That is how long it takes to get out. Thank you.

Now for a look at some other stories. UBS is holding a two-day

board meeting in Singapore. The chief executive of the Swiss Bank

is expected to get a rough ride. Only last week UBS revealed

unauthorised trading in its investment back division caused a

$2.3 billion loss. We go to Rico Hizon in Singapore. The board is

expected to be asked to back his plans for an overhaul of the

investment banking. They have a lack of confidence in the chief

executive? That is right. He may not be able to pursue these

internal reforms any longer because the Swiss media is currently

reporting that the UBS board has lost confidence in the chief

executive, following this multi- billion dollar rogue trading loss.

It is also being reported that the search for a replacement has begun.

Sources close to the board say the 67-year-old German has already been

asked to leave. Despite all of this speculation in the media, UBS has

not released a statement and will not comment at this point. Another

Swiss publication is reporting that his tenor will end after the bank's

board meeting today or tomorrow. -- Ten -- tenure. They say they are

disappointed and concerned with these trading lapses. Before the

two-day meeting in Singapore, the chief executive was confident he

would stay on as the CEO. He said he had the support of the board to

implement a radical overhaul of the investment bank's structure. So we

will have to wait and see for the official announcement. Thank you.

They could be a status update from Facebook. They are desperate to

cash in on its popularity and make more money from its 500 million

users. It is the key theme of the annual conference that opens in San

Francisco today. Few corporations have grown so big

and sold something so seemingly trivial. The opportunity to chat

with friends. Weather across continents all across the Office.

Facebook is -- has over half a billion users. How can it earned

more from them? It already earns money and has teamed up with a

video calling service. The talk among software developers is that

it is making to use the light feature where Facebook friends

highlight their favourite music, videos and TV shows. These can be

accessed through a Facebook page using services like Spotify. There

is an opportunity for Facebook to minor ties these services. They can

do things like charred a ground rate of two operators. They can

earn money through referrals and commissions. Why would Facebook be

on the lookout for these new money schemes? Perhaps because of its

plans to list on Wall Street. Judging by the price of the stock

it -- it sold to Goldman Sachs, Facebook is worth $50 billion. It

set itself a target of generating $4 billion worth of turnover every

year. But recent figures emerging through Goldman Sachs showed a

turnover of only $3.2 billion this year. It is time to sweat the

assets. You would not wheelie realise so much you are being

marketed to or being advertised to. It could step up to another level.

It will have more of a commercial Slad. Facebook's founder wants his

side to be a main operating plant on the internet. He wants people to

use it to access any service they need. But making Facebook to

overtly commercial make native lose what made it so appealing to begin

Now for more news from the UK. The Prime Minister will use a speech at

the UN today to encourage world leaders to take advantage of a

massive opportunity presented by the Arab Spring. He will tell the

UN's General Assembly that events in the Middle East mean it must

There are calls in China for people to stop eating a delicacy that is

endangering some shark species. As wages in China have risen, as has

the demand for shark fin soup. A star basketball player has lent his

name to a campaign to persuade people to stop eating the expensive

delicacy. A warning, some viewers may find some of these pictures

distressing. It is legal but harvesting a

shark's Finn is a gruesome business. The Finns are sliced off at sea.

They are then sold to Chinese restaurants to make soup. Myth has

it that the fines go back but in reality, the shark simply lead to

death. -- beneath his the shark grows back. We are linking this to

the origin of the soup. It is a beautiful and majestic animal. They

are fast in decline. I was moved by that picture, says this woman.

Humans really are the coolest animals. The sharp's theme is

tasteless and has no special nutritional value. But it high-cost

means it has become a status symbol in China. People come to

restaurants like this one behind me to bite the soup to show off their

This is BBC News. Coming up: Breakfast. Also, the day's news and

sport. All the latest developments. The headlines: President Obama

meets the Palestinian leader in New York where they are seeking full UN

membership. The White House said he had reiterated the government's

opposition to the move and told the President he would veto it.

A man convicted of killing an off- duty policeman in 1989 has been

executed in George back, despite international concern that the case

against him was not conclusively proved.

The US Fed has failed to convince investors.

But two American hikers held in Iran have arrived in Amman after

being released from prison. -- Oman. For the newspaper review. Now for

the -- we have the Federal Reserve's Lord of Operation Twist.

It is seen as an attempt to drive down long-term interest rate. The

US central bank is to buy $400 billion worth of trade.

In the wake of Italy's credit rating ground -- downgrading, it is