24/04/2012 World Business Report


24/04/2012

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newspapers he was in charge of. Now it is time for the latest

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financial news. The headlines: Going Dutch. The

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eurozone's consensus starts to unravel.

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Benetton's founder prepares to step down after 47 years.

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The collapse of the Dutch coalition government has sent shockwaves from

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Europe and global markets. Until the weekend of the Netherlands was

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judged to be part of the eurozone's safe course. Prime Minister Mark

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Rutte's failure to push through budget cuts... To talk us through

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some of the factors that spooked investors I welcome my guest. The

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poor economic data was unexpected? It was. Eurozone economies expected

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to be confirmed to be in recession for the first quarter. They were

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expected to be better than they were. What the numbers suggest is

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that the economy really is dragging along the bottom. On top of that we

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have negative political developments. Tell us how

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significant what happened in the Netherlands is and what it means

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for the eurozone. It has been largely ignored because of focus on

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a southern European economies. is a well structured economy. We

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have opposition against austerity. Some of the GDP data from the

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Netherlands last year was disappointing. Some stresses were

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appearing about further cuts. This is why the coalition broke down.

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One of the coalition partners refused to endorse the extra

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austerity needed. This is becoming a real theme - backlash against

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austerity. It is a theme in France with Francois Hollande and Nicolas

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Sarkozy talking about focusing on growth. It is difficult to sell the

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austerity measure, isn't it? That is right. Looking at the protests

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in Greece, in Spain. When you see it go into France and the

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Netherlands you begin to wonder if the eurozone really can remain on

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this track to bring in further austerity. I know Angela Merkel is

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determined and those at the ECB but say he didn't, people do things to

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get some growth going, why would that be such a bad thing?

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difficulty is getting the right policies in place. Policies aimed

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at generating growth have some form of fiscal spend and that is what

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they are trying to bring back. This is not particularly new. Going back,

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some of the EU summits in the past few months were designed to support

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growth but they were hijacked with respect to Greece. Trying to find

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policies... The Holy Grail of Economics. Thank you for that. You

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will be back later to discuss the newspaper stories.

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Apple is reporting second-quarter earnings later. Its stock has been

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hit recently. It has been turbulent ahead of these numbers. It'll be

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iPad and iPhone numbers that will hold it up. After meteoric games

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since the start of the year the Apple share price has been falling

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recently. The frenzied scenes that greeted

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the launch of products like the on those fine and iPad -- of the

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iPhone and iPad have increased their success. Earlier this month

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Apple shares peaked at $643 making it by far the world's most valuable

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company. In the last couple of weeks the trend has been the other

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way. Shares are down about 10%. Is this a temporary dip or a worrying

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new trend? I would not read anything into the sell-off from the

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highs that were very high for Apple to where it is right now. It is a

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mellow a sell-off in the stop. People are waiting to see the

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numbers and maybe what products are out there to stoke the growth going

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forward. Apple is facing greater competition for smartphones,

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cheaper devices running Google's and droid platform. -- S Android.

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But Apple has some things in its favour. We think in 12 months we

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will have a couple of massive product introductions - the iPhone

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five. For shoppers here in Manhattan they probably don't care

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too much about the share price. The next few months will be nervous for

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investors as they wait the launch of the next generation of iPhone.

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Some say Apple could yet become the world's first trillion dollar

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company. After 47 years at the helm, the

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chairman of Benetton is expected to stand down. His son will take over.

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He faces a challenge to restore the fortunes of the high-street

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retailer. Competition that respond instantly to market trends is

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emptying its stores. It will unveil its earnings later a today. Big

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changes for Benetton? He has been running the company for 47 years.

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It is a family dynasty. They have had a level of extraordinary

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success in launching their company and maintaining its position in the

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market. It is 47 years since the company was founded and today the

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founder will an ounce for handing over to his son. -- will announce

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the. Last year they failed to deliver a dividend and there has

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been criticism about the advertising campaign, very

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provocative. Tell us about his plans. The company is in a bit of

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trouble at the moment. It recently delisted from the Milan stock

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exchange. He may well decide to have more centralised control over

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the business. It has been based on franchising so far. The market

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feels that the company has failed to have this instant response in

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this fast and fashion business. I was walking through a tsar -- Zara

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store. There is talk of expanding the business in Asia. Thank you

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very much. Big changes at Benetton today.

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Facebook came out with news that their earnings fell 12% in the

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first three months of the year. You can see markets today are not

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having a good session at all in Asia. 40 minutes ago the markets,

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most of them were higher. It is only Japan down a bit. We are

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seeing losses across the board at the moment. Concern in Asia at the

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eurozone debt crisis. Many of the big economies in Asia export to

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