16/06/2011 World Business Report


16/06/2011

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Turkey to escape the violence. -- that was Syria, not Libya. Now it

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is time for World Business Report. The headlines: Greece's debt crisis

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rocks world markets. Sending shares and the euro tumbling. American

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luggage manufacturer Samsonite fails on the Hong Kong Stock

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Exchange. Research in Motion, the makers of BlackBerry, struggle in a

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changing market. Fear is gripping financial markets says Europe faces

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up to the possibility of Greece to defaulting on its debt so. The

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failure of the Greek government to push through new austerity measures

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amid violence has raised alert levels. Without further funding

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Greece cannot make bond repayments due next month. It has caused

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investor confidence to drop around the world, similar to the collapse

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of Lehman Brothers in September 2008. The yield on the two-year

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bond was over 28%. Markets now put the likelihood that Greece will not

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repay its debts at around 74%. Credit rating agency Moody's also

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warns it may be downgrading its ratings on French banks because of

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their investments in Greece, raising fears of so-called

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contagion. In Asia we have seen falls following yesterday's falls.

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The fear is that his -- is Greece defaults it could cause panic in

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the market. This was yesterday's markets in Europe. We will see how

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markets in Europe. We will see how they start their day in around an

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hour-and-a-half. The euro taking another battering. We have someone

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from the Economist Intelligence Unit. Things seem to be

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accelerating now. Yesterday's disastrous day for the Greek

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government not helping. Prime Minister Papandreou has announced a

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Cabinet reshuffle and bought a little more time for his cabinet

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and for Greece. You think Greece will default? What are the

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implications? Default: Firstly, in the banking sector. French banks

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have been downgraded by Moody's. May be downgraded by Moody's.

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Contagion through the banking sector. A lot of the European banks

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have written down their great debt. I do not think there will be a

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financial crisis throughout Europe financial crisis throughout Europe

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if Greece to falls. Secondly, they will think: His next? BA -- the

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answer is Portugal, and then Ireland. They might go for a

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strategic default. If we cedar falls across the eurozone we may

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see a to unravel. Obviously Greece being a part of the eurozone means

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it cannot play with its currency, which could probably benefit it

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right now. Do you think they may choose to leave the eurozone his

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face takes place? I think there is a real possibility. Greece cannot

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devalue its currency so it is trying to do an internal

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devaluation, which is extremely painful. He in the meantime, the

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IMF is saying it probably will give its next batch of money to Greece.

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The EU leaders are tried to come to an agreement about their next batch

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of money. If Greece defaults, that all stops, doesn't it? The second

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that Greece defaults on its debt or restructures its dead all bets are

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off and it will not fulfil the conditions of its bail out added

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will lose access to official funded. Thank you for talking us through

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the implications. And of course we are keeping a close eye on what is

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happening in Greece. Research n Motion, the maker of BlackBerry. Is

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it too slow in a changing market? The company reports first-quarter

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results after close of business today. It has already reported that

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sales of its phone will be down. Before Google's Android there was

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the BlackBerry. The smart phone that is still the chosen device for

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most businesses, yet its share price tells a different story.

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Research n Motion, the Canadian company behind BlackBerry, has seen

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its share price tumbled by almost 40% since the start of this year.

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When they were a hot stock they were perceived as invincible

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because they had most of the corporate market. Once that turns

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it is like they fell out of love with it. BlackBerry's first tablet

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computer was released their earlier this year in the US to mixed

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reviews. But it is their devices the company has not yet launched

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that investors are waiting for. the horizon is operating system

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software which runs there tablet computer. They are supposed to

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bring that operating system to use their telephones some time next

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year. That could be a big upgrade if they achieve it. And as if that

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Research n Motion did not have enough on their plate, they are

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being sued by Dolby for using some of which audio technology without

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permission. The tablet may have helped to boost profits since it

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went on sale in spring, but if the company comes back with any bad

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news about its prospects prospecre price could move lower. BBC News,

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New York. It has been a disappointing market debut for the

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luggage maker her Samsonite. What has been going on? Several factors.

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Fragile investor sentiment and bad timing as Samsonite listed amid a

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slump in Hong Kong. It does not help when the benchmark Hang Seng

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index has declined during this period. There is also concern about

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high interest rates in China, debt troubles in Greece and we keep US

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economic gross. Hong Kong IPOs generally attract a lot of interest,

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but Samsonite, according to many traders, was not particularly hot

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among them. Despite the fall and it's frustrating day the Samsonite

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Chief Executive remains optimistic, saying the company plans to build

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its business in China, India and other parts of Asia. Waning

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investor at appetite has other companies also shelving IPOs.

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Including a Chinese auto parts company and an Australian mining

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company. Italian fashion house Prada is a much larger IBO at two.

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$6 billion. It lists on 24th June. Thank you. Let's stay with news

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ut on the international markets. It

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has been a turbulent start for Pandora. A wider sell-off in the

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market sent them tumbling. The company is valued at $2.8 billion

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or 20 times last year's sales. Pandora is yet to make a profit.

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Some investors are calling the rash of flirtations with internet

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companies a repeat of the dot com bubble. Acomb Peter that almost

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