30/10/2013 World Business Report


30/10/2013

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`` three years ago are. Those are the latest headlines. Time

:00:00.:00:17.

for the money news. Good`bye, recession. Confirmation

:00:18.:00:25.

that the Spanish economy is growing slightly.

:00:26.:00:29.

Addicted to the multibillion dollars stimulus, sure markets rally as

:00:30.:00:34.

traders expect no change in policy as the US central bank holds its

:00:35.:00:40.

monthly meeting. `` share markets.

:00:41.:00:47.

Welcome to World Business Report. Also in the programme, smoking is

:00:48.:00:53.

going out of fashion in Japan. We will have the details. But first of

:00:54.:00:57.

all, after two years of shrinking wealth, officials will confirm that

:00:58.:01:02.

Spain is out of recession. Just buy a touch. Spain's National statistics

:01:03.:01:09.

agency is due to confirm what estimates from the bank of Spain

:01:10.:01:12.

suggested last week, that the economy grew by 0.1% in the three

:01:13.:01:20.

months ending in September. Spanish friends are selling workers overseas

:01:21.:01:24.

and money are starting to flow back into the country. But very few would

:01:25.:01:27.

know people are feeling the benefits. `` ordinary. Many families

:01:28.:01:40.

remain strapped for cash. Spain's economy is finally growing

:01:41.:01:48.

again. Sales are even recovering at this company in Madrid, which

:01:49.:01:52.

depends on construction. They make cupboard doors. The man who owns

:01:53.:01:59.

this and my other businesses in the area believes that consumer

:02:00.:02:04.

confidence is returning, but some problems remain. `` nine. In Spain

:02:05.:02:11.

the most important problem we have is the credit. Banks are better than

:02:12.:02:20.

before, but credit is stopping. They are still nervous? Yes. Everybody

:02:21.:02:29.

needs to know that we have money to spend in projects and enterprise. At

:02:30.:02:34.

the moment it is difficult to receive credit. At the problems

:02:35.:02:40.

caused by excessive lending in the past are still being cleaned up.

:02:41.:02:46.

This is a town that became a symbol of Spain's economic crisis.

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Thousands of apartments were built which initially few people bought.

:02:51.:02:55.

But after the boom in the past, property prices were slashed. In the

:02:56.:02:58.

past few months, many people have moved in. Perhaps a tentative signs

:02:59.:03:04.

that Spain's economy is on the road to recovery. But the road is very

:03:05.:03:13.

long. These buildings have been passed from banks to a so`called bad

:03:14.:03:19.

bank. There are still hundreds of thousands of properties as toxic

:03:20.:03:28.

assets to be sold off. And for all the positive talk about Spain posit

:03:29.:03:32.

economy, the reality for many Spaniards is very different. ``

:03:33.:03:37.

spend's economy. This man still lives with his mother and has been

:03:38.:03:44.

unemployed for five years. It is just macroeconomic data, he tells

:03:45.:03:49.

us. Spanish exports may have improved, but wages are down, prices

:03:50.:03:52.

are up and people are consuming less. The spend's economy might be

:03:53.:04:03.

out of recession, there are several reasons to celebrate. But

:04:04.:04:10.

unemployment is still skyhigh. It is not game over for spend's economic

:04:11.:04:18.

crisis just yet. What a difference a few weeks can

:04:19.:04:22.

make. Last month most people thought the US central bank was going to

:04:23.:04:27.

reduce emergency funding. But after the damaging government shut and

:04:28.:04:30.

disappointing having figures from US firms, the economy looks

:04:31.:04:35.

substantially weaker than it did before. The Federal reserve will

:04:36.:04:38.

announce its policy decision later today. It is expected to post a

:04:39.:04:45.

possibly fatal move to stimulus measures. The world's three major

:04:46.:04:51.

central banks flooding the market with cheap market leaseback ``

:04:52.:05:02.

money. It was first introduced by the bank

:05:03.:05:06.

of Japan. It continued for five years. Until its recent recovery,

:05:07.:05:12.

Japan's economy had been stuck in what became known as a lost decade.

:05:13.:05:19.

Did it actually work? I do not think it worked in Japan. It was supposed

:05:20.:05:26.

to turn deflation into inflation. That did not happen. You cannot see

:05:27.:05:31.

any difference in deflation rates. You do not seek differences in the

:05:32.:05:39.

growth rate of the economy. It is as it if it never happened. But the

:05:40.:05:46.

purpose of the policy in the US was different. It was used as a last

:05:47.:05:50.

resort to get the credit market working again. Its aim was to

:05:51.:05:55.

prevent the US economy from falling into a series of depression like the

:05:56.:06:05.

1930s. In the heart of Manhattan, America's economy may seem vibrant.

:06:06.:06:08.

That is partly thanks to all the stimulus measures. But there is fear

:06:09.:06:12.

the United States is following the same path as Japan. And withdrawing

:06:13.:06:20.

all that cheap money is not them carefully, it could destroy the

:06:21.:06:27.

recent growth. If they can hit the side of a bind, then the bulls eye

:06:28.:06:31.

just be close. It will not be the end of the world. On the other

:06:32.:06:36.

hand, the expectation that they will completely mess it up, that they

:06:37.:06:41.

could not fall out of a boat and Pittwater, think that is a gross

:06:42.:06:47.

exaggeration. Then bring a key was the man who started the experiment

:06:48.:06:51.

in the United States. He will be the one to end it. For his likely

:06:52.:06:56.

successor, it may prove to be a more challenging task.

:06:57.:07:05.

Now a look at the impact that is having on markets at the end of the

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show. But tobacco shares in Japan are climbing to date after setting

:07:10.:07:20.

to close several factories. What is happening? Are the Japanese giving

:07:21.:07:28.

up on smoking? That is one reason. The maker of international brands

:07:29.:07:31.

western and camel is also blaming the declining demand to the

:07:32.:07:37.

country's shrinking population. According to the company, the ratio

:07:38.:07:41.

of smokers in Japan fell by 4% over the past four years. The once huge

:07:42.:07:46.

number of smokers continues to shrink. Another issue is the sales

:07:47.:07:55.

stats. This is expected to hurt sales even further. `` sales tax.

:07:56.:08:04.

1600 jobs have been cut and four out of nine factories were closed. It

:08:05.:08:12.

will be focusing on overseas sales. 48% of its total sales in the last

:08:13.:08:17.

fiscal year came from the overseas numbers. Other segments such as food

:08:18.:08:24.

and medical products will also be capped. And before you go, tell us

:08:25.:08:38.

about the recall? More than 100,000 are being recalled. This will

:08:39.:08:45.

address potential brake problems. This is the fourth automaker recall

:08:46.:08:51.

in Visio. It follows the Genesis model last week due to the same

:08:52.:08:58.

issue. Last month you had here and they. They said that they were

:08:59.:09:08.

recalling about 660,000 details. `` vehicles. Problems for the top

:09:09.:09:17.

automakers. Thank you very much. Very interesting. Time to have a

:09:18.:09:20.

look at the markets. A busy day for corporate stories.

:09:21.:09:26.

Also, China's state owned oil company posted a 20% rise in

:09:27.:09:34.

profits. Markets are much higher. There are positive ahead of the

:09:35.:09:42.

Federal reserve meeting. Those are the markets. The dollar

:09:43.:09:45.

will be very sensitive today. See you soon.

:09:46.:10:01.

The number of long`term unemployed young people in the UK is the

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highest it has been for nearly 20 years. It is more than quadrupled in

:10:06.:10:12.

the last decade. There is warning that without urgent investment from

:10:13.:10:16.

the government, tens of thousands are in danger of

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