Browse content similar to 19/12/2013. Check below for episodes and series from the same categories and more!
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says it will map 1 billion stars. Now for the latest financial news | :00:00. | :00:00. | |
with World Business Report. The beginning of the end of cheap | :00:00. | :00:25. | |
money at the Fed begins to scale back its massive stimulus programme. | :00:26. | :00:29. | |
Plus, no more taxpayer bailouts. Europe strikes a deal that will see | :00:30. | :00:37. | |
investors put the Bill, -- foot the bill for future failures. | :00:38. | :00:45. | |
Also in the programme, we will join our team in Asia to get the latest | :00:46. | :00:49. | |
on market reaction there to that fed decision. The world economy has been | :00:50. | :00:54. | |
watching and waiting for some time, and it is now finally happening. The | :00:55. | :01:00. | |
US Federal Reserve, the most powerful Central Bank in the world, | :01:01. | :01:05. | |
says it will start to scale back its economic stimulus programme from | :01:06. | :01:09. | |
January. The Fed has been pumping $85 billion per month into the US | :01:10. | :01:14. | |
economy, for just over a year. It has been buying of Treasury and | :01:15. | :01:17. | |
mortgage bonds. It will trim that to buy 10 billion a month. -- it will | :01:18. | :01:26. | |
trim that by 10 million per month. It may keep interest rates lower, | :01:27. | :01:40. | |
and now the tapering has started, Wall Street seems to be reassured it | :01:41. | :01:45. | |
will happen slowly. The stock market closed at record highs. | :01:46. | :01:54. | |
The decision taken by those inside this building will have consequences | :01:55. | :01:58. | |
around the world. But their actions were driven by what is going on | :01:59. | :02:03. | |
right here in the US. In fact, Ben Bernanke talked about the | :02:04. | :02:08. | |
improvement in the US economy, in particular what is happening in the | :02:09. | :02:14. | |
jobs market. Reflecting an improved outlook for | :02:15. | :02:17. | |
the job market, we decided to moderately reduced the monthly | :02:18. | :02:24. | |
pace. If incoming information supports the committee's expectation | :02:25. | :02:27. | |
of further progress towards its objectives, the committee is likely | :02:28. | :02:31. | |
to reduce the purchases in further measured steps in the future. The | :02:32. | :02:37. | |
Federal Reserve doesn't believe this is job done, in fact Ben Bernanke | :02:38. | :02:40. | |
talked about how many Americans had dropped out of the workforce | :02:41. | :02:44. | |
completely. They will continue to support the US economy, buying up | :02:45. | :02:49. | |
$75 billion worth of bonds each month. In combination with reducing | :02:50. | :02:58. | |
the amount of bonds they will buy, they will keep interest rates lower | :02:59. | :03:01. | |
for longer. It seems they have managed this shift in policy quite | :03:02. | :03:05. | |
successfully. The Fed decision was not the only | :03:06. | :03:10. | |
big news from Washington being digested on Wall Street. The US | :03:11. | :03:13. | |
Senate voted through a two-year budget deal, already passed by the | :03:14. | :03:16. | |
House of Representatives last week. The vote brings to an end for now | :03:17. | :03:22. | |
the deadlock between Democrats and Republicans over public spending | :03:23. | :03:26. | |
that saw the large swathe of government shutdown in government, | :03:27. | :03:31. | |
and brought them to the brink of defaulting on debts. That has | :03:32. | :03:34. | |
removed a major worry for Ben Bernanke, as we explain. | :03:35. | :03:42. | |
A few months ago, when we heard from Ben Bernanke when he was testifying | :03:43. | :03:45. | |
on Capitol Hill, he mentioned the dysfunction in Washington as being a | :03:46. | :03:48. | |
hindrance to the US economic recovery. The fact that the US now | :03:49. | :03:54. | |
has a budget, it has not had a budget in three years. So what the | :03:55. | :03:59. | |
government has passed today is actually going to fund the | :04:00. | :04:04. | |
government well into 2015. It is a major hurdle, both for Washington, | :04:05. | :04:09. | |
in terms of its politics, but also a significant for the economy because | :04:10. | :04:12. | |
that gives the economy some sort of stability, and that is really | :04:13. | :04:16. | |
important when we are talking about an economy that is recovering from a | :04:17. | :04:19. | |
recession. How has this all being digestive in | :04:20. | :04:25. | |
Asia? Rico Hizon is in Singapore. A black screen, that's not looking | :04:26. | :04:29. | |
good at all! Let's hope we can get to Rico Hizon, because we mention | :04:30. | :04:33. | |
the fact that the markets on Wall Street had a really strong session. | :04:34. | :04:42. | |
There you are, a black screen is never a good seem Dominic thing -- | :04:43. | :04:56. | |
in to see. When you speak to policy makers they say the negative effects | :04:57. | :04:58. | |
of this US paper on markets would likely be limited. For example, | :04:59. | :05:03. | |
South Korea promised it will act swiftly to stabilise markets if | :05:04. | :05:08. | |
necessary, but they say the move is basically reducing a lot of the in, | :05:09. | :05:20. | |
uncertainties. There could be a period of instability between May | :05:21. | :05:24. | |
and June, but has for the Asian markets, they are mostly higher. | :05:25. | :05:29. | |
They see the Fed's position as a vote of confidence that the US | :05:30. | :05:33. | |
economy is in the strengthening. They say an expanding US economy is | :05:34. | :05:41. | |
positive news for Asian X -- exporters, with as many US consumers | :05:42. | :05:52. | |
buy from Asia. The yen has fallen yet again to the US dollar, to | :05:53. | :05:58. | |
levels not seen since 2008. Australian shares are rallying the | :05:59. | :06:01. | |
most in nearly eight weeks, with mining companies leading the charge. | :06:02. | :06:04. | |
There are two major markets that are currently on the other side of the | :06:05. | :06:10. | |
spectrum, China and Hong Kong, currently in negative territory. The | :06:11. | :06:16. | |
cost of stock trading has been pushed up. Emerging Asian currencies | :06:17. | :06:22. | |
are falling as well, the Indonesian rupiah hitting a five-year low. The | :06:23. | :06:26. | |
Singapore dollar and the Philippine peso are all touching their lowest | :06:27. | :06:33. | |
levels in three months. We have to wait and see what will be the short | :06:34. | :06:36. | |
and medium-term impact of this tapering off of the programme of the | :06:37. | :06:41. | |
Federal Reserve, which will begin in January 2014. | :06:42. | :06:50. | |
A story that will affect European trading possibly as well, when we | :06:51. | :06:53. | |
start the day he later. Let's move on, because the question of who | :06:54. | :06:58. | |
should pay when a bank goes bust was grappled with into the midnight | :06:59. | :07:05. | |
hour. Not the taxpayer, says a new rule to be signed off by European | :07:06. | :07:07. | |
leaders at the Brussels summit today. It would see rescue money | :07:08. | :07:12. | |
come from the banking industry and its investors. The aim is to prevent | :07:13. | :07:19. | |
a repeat of the turmoil of recent years when failing bank in countries | :07:20. | :07:24. | |
from Ireland to Cyprus were brought to the brink of bankruptcy. | :07:25. | :07:35. | |
The banking and financial sectors are vital to recovery. European | :07:36. | :07:40. | |
leaders know it is essential to their recovery that they police | :07:41. | :07:46. | |
whether big banks can live or die. Member states have argued over the | :07:47. | :07:50. | |
fine details write to the wire, footing the collective bill of | :07:51. | :07:57. | |
ailing banks to stop whole states being dragged down with them. The | :07:58. | :08:04. | |
plan on the table is that if it bank has to be shut, shareholders and | :08:05. | :08:09. | |
creditors take the first hit, then the home country. We are introducing | :08:10. | :08:14. | |
revolutionary change to Europe's financial sector. This is so that | :08:15. | :08:22. | |
taxpayers no longer foot the bill when banks make mistakes or face | :08:23. | :08:31. | |
crisis. Indeed, the era of massive bailouts is over. This will be | :08:32. | :08:39. | |
merged into an all Europe resolution fund. It has been a long road, and | :08:40. | :08:45. | |
this Brussels analyst says it is inevitable it will take a long time | :08:46. | :08:49. | |
to complete. What is missing is that they are trying to put in place a | :08:50. | :08:54. | |
resolution stability fund, but that will be in place over the next ten | :08:55. | :09:00. | |
years. It will take a while to have it in place. The question is, how | :09:01. | :09:03. | |
will you deal with potential bank failures in the meantime? Here, you | :09:04. | :09:07. | |
need a strong financial backdrop, and can ace debility mechanism be | :09:08. | :09:13. | |
that backstop? -- stability mechanism. It was said bluntly at | :09:14. | :09:26. | |
the European Parliament this week. We should not create a single | :09:27. | :09:30. | |
resolution mechanism that is single in name only. Whatever is agreed | :09:31. | :09:34. | |
this week, the banking union won't be ready for some important European | :09:35. | :09:39. | |
Central Bank health checks on banks like this which are due to be | :09:40. | :09:44. | |
competing next November. This breaks the loop between banks and their | :09:45. | :09:49. | |
sovereign countries, and it could take years. It does seem that at | :09:50. | :09:56. | |
last they are making a start. That his World Business Report, we | :09:57. | :09:59. | |
will see you soon as we look through the papers. Stay with us. | :10:00. | :10:11. | |
An independent enquiry into breast care services in hospitals in the | :10:12. | :10:18. | |
West Midlands will be published this morning. It follows an investigation | :10:19. | :10:24. | |
into surgeon Ian Pattison, over allegedly botched operations on 1200 | :10:25. | :10:25. |