The four-door "Figo", which is Italian slang for 'cool', will go on sale in India during the first quarter of next year, Ford executives told a press conference Wednesday. There are also plans to export the low-cost car to other Asian countries.
The automaker declined to reveal the Figo's sale price and initial production volumes. One analyst said he expects the Figo to sell for 300,000 to 400,000 rupees ($6,000 to $8,000), putting it in competition with several other compact models, including the high-end Tata Nano, which sell for 250,000 to 550,000 rupees.
The Figo represents a change of gear for U.S. automakers, which have been slow to penetrate India's small but fast-growing car market but are now increasingly chasing growth in Asia.
"This new car will be a game changer," said Michael Boneham, president of Ford India. "It will give us muscle in the heart of the Indian market."
Ford chief executive Alan Mulally said he expects a third of global car sales to come from Asia in 20 years, a third from the Americas and a third from Europe and Russia.
The company has a lot of catching up to do in Asia. Ford, the only major U.S. automaker to survive the financial crisis without a taxpayer bailout, has about 15 percent market share in North America, 10 percent in Europe and just 2 percent in Asia.
Executives said they would be making an announcement later this week about ramping up Ford's China production capacity, currently at 450,000 vehicles a year. They wouldn't confirm reports the automaker will open a third assembly plant in China.
The Figo is the first fruit of a $500 million India investment Ford announced last year. That money will also be used to double production at its factory in the southern city of Chennai, to 200,000 vehicles a year, and raise engine production to 250,000 a year. The expansion is part of Ford's effort to transform India into a small car production and export hub -- a strategy that Hyundai, India's largest car exporter, has excelled at.
In India, U.S. automakers have proven less nimble than their Japanese, Korean and Indian competitors in offering cars that are small and cheap enough to attract the mass of the buying public.
Three-quarters of all cars sold in India are compacts. Though Ford has been doing business in India since 1995, the Figo is its first compact offering to target the mass market.
Wednesday, September 23, 2009
EU financial watchdog to rely on moral authority
The European Union's new economic watchdog plans to use "moral pressure" instead of regulatory authority to crack down on countries posing major risks to Europe's economy, the European Commission said Wednesday.
The EU's executive body laid out a new financial oversight structure Wednesday that it wants EU governments to back to prevent a repeat of last year's banking crisis. Still, it is shying away from creating forceful new regulators who could unilaterally overrule member states.
This move is contingent upon a asic assumption that consumers pay heed to ''moral pressure"which is considerably debatable.
The EU's executive body laid out a new financial oversight structure Wednesday that it wants EU governments to back to prevent a repeat of last year's banking crisis. Still, it is shying away from creating forceful new regulators who could unilaterally overrule member states.
This move is contingent upon a asic assumption that consumers pay heed to ''moral pressure"which is considerably debatable.
Monday, September 14, 2009
Oil drops below $69 as dollar gains, stocks slide
Oil prices dropped below $69 a barrel Monday, hurt by a rise in the U.S. dollar, which tends to weigh on commodities, and a slide in regional stock markets.
By midday in Europe, Benchmark crude for October delivery was down 59 cents to $68.70 a barrel in electronic trading on the New York Mercantile Exchange. On Friday, the contract tumbled $2.65 to settle at $69.29.
Oil prices have fallen about $4 in the last two trading days as the dollar rebounded off its lows of the year last week. Oil is priced in dollars so it becomes more expensive when the U.S. currency gains.
The euro fell Monday to $1.4538 from $1.4594 on Friday, the British pound fell to $1.6539 from $1.6687 and the dollar rose to 90.80 Japanese yen from 90.57 yen.
Oil traders are also eyeing stock markets for an overall reading of investor confidence. Most Asian and European indexes fell Monday.
"Oil's being driven down by the dollar and weakness in Asian stocks," said Victor Shum, an energy analyst with consultancy Purvin & Gertz in Singapore. "There are also worries about oil demand."
Crude has traded between $65 and $75 for the last few months as investors seek to understand how far consumer demand can recover as the global economy stabilizes.
Shum said oil will likely remain in that range until there is a strong new catalyst.
"There are no clear forces to cause oil to break out of that range," Shum said. "I don't expect this pullback to be very significant."
Britain's KBC Market Services concurred, but warned that "if the improved economic mood doesn't last then a major correction could happen very fast."
In other Nymex trading, gasoline for October delivery fell 1.87 cents to $1.7411 a gallon, and heating oil dropped 0.83 cents to $1.7225 a gallon. Natural gas rose 5.4 cents to $3.014 per 1,000 cubic feet.
In London, Brent crude was down 37 cents to $67.32 on the ICE Futures exchange.
By midday in Europe, Benchmark crude for October delivery was down 59 cents to $68.70 a barrel in electronic trading on the New York Mercantile Exchange. On Friday, the contract tumbled $2.65 to settle at $69.29.
Oil prices have fallen about $4 in the last two trading days as the dollar rebounded off its lows of the year last week. Oil is priced in dollars so it becomes more expensive when the U.S. currency gains.
The euro fell Monday to $1.4538 from $1.4594 on Friday, the British pound fell to $1.6539 from $1.6687 and the dollar rose to 90.80 Japanese yen from 90.57 yen.
Oil traders are also eyeing stock markets for an overall reading of investor confidence. Most Asian and European indexes fell Monday.
"Oil's being driven down by the dollar and weakness in Asian stocks," said Victor Shum, an energy analyst with consultancy Purvin & Gertz in Singapore. "There are also worries about oil demand."
Crude has traded between $65 and $75 for the last few months as investors seek to understand how far consumer demand can recover as the global economy stabilizes.
Shum said oil will likely remain in that range until there is a strong new catalyst.
"There are no clear forces to cause oil to break out of that range," Shum said. "I don't expect this pullback to be very significant."
Britain's KBC Market Services concurred, but warned that "if the improved economic mood doesn't last then a major correction could happen very fast."
In other Nymex trading, gasoline for October delivery fell 1.87 cents to $1.7411 a gallon, and heating oil dropped 0.83 cents to $1.7225 a gallon. Natural gas rose 5.4 cents to $3.014 per 1,000 cubic feet.
In London, Brent crude was down 37 cents to $67.32 on the ICE Futures exchange.
Sunday, September 13, 2009
China: Trade penalties will hurt US relations
President Barack Obama's decision to impose trade penalties on Chinese tires has infuriated Beijing at a time when the U.S. badly needs Chinese help on climate change, nuclear standoffs with Iran and North Korea and the global economy.
China condemned the White House's announcement late Friday as protectionist and said it violated global trade rules. At home, the punitive tariffs on all car and light truck tires coming into the U.S. from China may placate union supporters who are important to the president's health care push.
To the White House, it was "simply about enforcing the rules of the road and creating a trade system that is based on those rules and is fair for everyone," spokesman Robert Gibbs told reporters traveling with Obama on Saturday to a health care event in Minneapolis.
Chen Deming, China's minister of commerce, said the penalties would hurt relations with the U.S. A ministry statement said Obama had "compromised to the political pressure of the U.S. domestic trade protectionism."
"The Chinese government will continue to uphold the legitimate interests of China's domestic industry and has the right to take corresponding measures," Deming said.
Obama had until this coming Thursday to accept, reject or modify a U.S. International Trade Commission ruling that a rising tide of Chinese tires into the U.S. hurts American producers. The United Steelworkers blames the increase for the loss of thousands of American jobs.
The federal trade panel recommended a 55 percent tariff in the first year, 45 percent in the second year and 35 percent in the third year. Obama settled on 35 percent the first year, 30 percent in the second and 25 percent in the third, Gibbs said
"For trade to work for everybody, it has to be based on fairness and rules. We're simply enforcing those rules and would expect the Chinese to understand those rules," Gibbs said.
The decision comes as U.S. officials are working with the Chinese and other nations to plan an economic summit in Pittsburgh on Sept. 24-25 of the 20 leading rich and developing nations. China will be a major presence at the meeting, and the United States will be eager to show it supports free trade.
Many of the nearly two dozen world leaders Obama is hosting have made strong statements critical of countries that protect their key industries. Obama, too, has spoken out strongly against protectionism, and other countries will view his decision on tires as a test of that stance.
Governments around the world have suggested the U.S. talks tough against protectionism only when its own industries are not threatened. U.S. rhetoric on free trade also has been questioned because of a "Buy American" provision in the U.S. stimulus package.
The tire decision could have ramifications on issues such as the nuclear disputes with Iran and North Korea and on efforts to address climate change. China is the world's third-largest economy and a veto-holding member of the U.N. Security Council.
Roy Littlefield, executive vice president of the Tire Industry Association, which opposes the tariff, said it would not save American jobs. He said the penalties would cause tire manufacturers to move production to another country with less strict environmental and safety controls, less active unions and lower costs than the United States.
The steelworkers union brought the original case in April, accusing China of making a recent push to unload more tires ahead of Obama's expected action. The union says more than 5,000 tire workers have lost jobs since 2004, as Chinese tire overwhelmed the U.S. market.
The U.S. trade representative's office said four tire plants closed in 2006 and 2007 and three more are closing this year. During that time, just one new plant opened. U.S. imports of Chinese tires more than tripled from 2004 to 2008 and China's market share in the U.S. went from 4.7 percent of tires purchased in 2004 to 16.7 percent in 2008, the office said.
In a two-page statement China said the tariffs do not square with the facts.
There hasn't been an obvious increase of exports of tires to the U.S., the statement said, citing a 2.2 percent increase in 2008 from 2007, and a 16 percent fall in exports in the first half of 2009 compared with first half of 2008.
The new tariffs, on top of an existing 4 percent tariff on all tire imports, take effect Sept. 26.
China condemned the White House's announcement late Friday as protectionist and said it violated global trade rules. At home, the punitive tariffs on all car and light truck tires coming into the U.S. from China may placate union supporters who are important to the president's health care push.
To the White House, it was "simply about enforcing the rules of the road and creating a trade system that is based on those rules and is fair for everyone," spokesman Robert Gibbs told reporters traveling with Obama on Saturday to a health care event in Minneapolis.
Chen Deming, China's minister of commerce, said the penalties would hurt relations with the U.S. A ministry statement said Obama had "compromised to the political pressure of the U.S. domestic trade protectionism."
"The Chinese government will continue to uphold the legitimate interests of China's domestic industry and has the right to take corresponding measures," Deming said.
Obama had until this coming Thursday to accept, reject or modify a U.S. International Trade Commission ruling that a rising tide of Chinese tires into the U.S. hurts American producers. The United Steelworkers blames the increase for the loss of thousands of American jobs.
The federal trade panel recommended a 55 percent tariff in the first year, 45 percent in the second year and 35 percent in the third year. Obama settled on 35 percent the first year, 30 percent in the second and 25 percent in the third, Gibbs said
"For trade to work for everybody, it has to be based on fairness and rules. We're simply enforcing those rules and would expect the Chinese to understand those rules," Gibbs said.
The decision comes as U.S. officials are working with the Chinese and other nations to plan an economic summit in Pittsburgh on Sept. 24-25 of the 20 leading rich and developing nations. China will be a major presence at the meeting, and the United States will be eager to show it supports free trade.
Many of the nearly two dozen world leaders Obama is hosting have made strong statements critical of countries that protect their key industries. Obama, too, has spoken out strongly against protectionism, and other countries will view his decision on tires as a test of that stance.
Governments around the world have suggested the U.S. talks tough against protectionism only when its own industries are not threatened. U.S. rhetoric on free trade also has been questioned because of a "Buy American" provision in the U.S. stimulus package.
The tire decision could have ramifications on issues such as the nuclear disputes with Iran and North Korea and on efforts to address climate change. China is the world's third-largest economy and a veto-holding member of the U.N. Security Council.
Roy Littlefield, executive vice president of the Tire Industry Association, which opposes the tariff, said it would not save American jobs. He said the penalties would cause tire manufacturers to move production to another country with less strict environmental and safety controls, less active unions and lower costs than the United States.
The steelworkers union brought the original case in April, accusing China of making a recent push to unload more tires ahead of Obama's expected action. The union says more than 5,000 tire workers have lost jobs since 2004, as Chinese tire overwhelmed the U.S. market.
The U.S. trade representative's office said four tire plants closed in 2006 and 2007 and three more are closing this year. During that time, just one new plant opened. U.S. imports of Chinese tires more than tripled from 2004 to 2008 and China's market share in the U.S. went from 4.7 percent of tires purchased in 2004 to 16.7 percent in 2008, the office said.
In a two-page statement China said the tariffs do not square with the facts.
There hasn't been an obvious increase of exports of tires to the U.S., the statement said, citing a 2.2 percent increase in 2008 from 2007, and a 16 percent fall in exports in the first half of 2009 compared with first half of 2008.
The new tariffs, on top of an existing 4 percent tariff on all tire imports, take effect Sept. 26.
A $100 M question:Where is broadband?
The national stimulus package passed by Congress in February may have been too enthusiastic about spending money on one particular project: figuring out where broadband Internet access is available and how fast it is.
The $787 billion stimulus bill championed by the Obama administration set aside up to $350 million to create a national broadband map that could guide policies aimed at expanding high-speed Internet access. That $350 million tag struck some people in the telecommunications industry as excessive, compared with existing, smaller efforts. The map won't even be done in time to help decide where to spend much of the $7.2 billion in stimulus money earmarked for broadband programs.
Now it appears the final cost won't be as high as $350 million -- though just how much it will be is unclear.
Now it appears the final cost won't be as high as $350 million -- though just how much it will be is unclear.
BUT IS THAT TRULY WARRANTED, ONE MIGHT ASK BUT THE SIMPLE ANSWER IS WHO KNOWS
Even $100 million might be high. The firm could create a national broadband map for $3.5 million, and "would gladly do it for $35 million," Altman said.
Dave Burstein, editor of the DSL Prime, believes a reasonable cost for the map would be less than $30 million.
The map should reveal what most individuals already know: whether their homes can get broadband, and how fast it is. Officially, the goal for the map is to help shape broadband policy and determine where best to invest government funds. It may also help consMumers shopping for Internet service.
Dave Burstein, editor of the DSL Prime, believes a reasonable cost for the map would be less than $30 million.
The map should reveal what most individuals already know: whether their homes can get broadband, and how fast it is. Officially, the goal for the map is to help shape broadband policy and determine where best to invest government funds. It may also help consMumers shopping for Internet service.
mark Seifert, who is overseeing the broadband grant and mapping programs at the NTIA, offers several reasons why the federal government may spend proportionally more on mapping than some states. For one thing, he said, most efforts that have been done in states have focused on so-called "last-mile" connections that link homes and businesses with the broader infrastructure of the Internet. The NTIA also wants extensive data on that behind-the-scenes Internet infrastructure.What's more, since much of the mapping data will come from phone and cable companies, the NTIA wants the information to be independently verified -- which could involve knocking on doors to confirm where broadband is and is not available and conducting other on-the-ground checks."You can spend less money on a map ... but you get what you pay for," he said. "Data costs money."
Saturday, September 12, 2009
POTENTIAL DOWNTURNS AROUND THE CORNER
While we may be lampooning the current global market downturn, some believe that more might be around the corner because of the unquenchable capability of human beings when confronted with long periods of prosperity to presume that it will continue.
Hop on to this page to find this interesting and sort of intmidating article about what dangers lie ahead.
http://finance.yahoo.com/tech-ticker/article/325783/Ten-Bubbles-in-the-Making;_ylt=Av.fwhhLHVk9ksSQCBU0YS1brdIF;_ylu=X3oDMTEybWhkcjl1BHBvcwMxBHNlYwNhcnRpY2xlBHNsawMxMGJ1YmJsZXNpbnQ-?tickers=%5Egspc,%5Edji,xlfi
Hop on to this page to find this interesting and sort of intmidating article about what dangers lie ahead.
http://finance.yahoo.com/tech-ticker/article/325783/Ten-Bubbles-in-the-Making;_ylt=Av.fwhhLHVk9ksSQCBU0YS1brdIF;_ylu=X3oDMTEybWhkcjl1BHBvcwMxBHNlYwNhcnRpY2xlBHNsawMxMGJ1YmJsZXNpbnQ-?tickers=%5Egspc,%5Edji,xlfi
A MEAGRE CONFERENCE TO HONOUR 'LITERACY DAY'
While most of the populace of Pakistan was understandably unaware that yesterday was the World Literacy Day, it was the ignorance of the media and the government that was most astonishing. All that was done was to have the Education minister to adress some people in Marriott hotel. The minister asserted that we have been going the wrong way in proliferating education in Pakitan for the last 62 years. He also contended the notion that the new government plan was working in the direction of making education widely available and accessible. There was nothing said about the future plans or changes that the Minister intends to implement in the educational system.
HAPPY LITERACY DAY!!!
I think we have had enough of the extremely sophisticated and esoteric language of my news post and so, I use a very candid tone to wish you all a belated HAPPY LITERACY DAY!! What was said and done on this day in Pakistan comes right after this post.
Saturday, September 5, 2009
HOW TRUE!!
Greg Mankiv recently posted this picture. How true is that cartoon. Sort of reminds me article in my economics texbook from the Economist about the same issue.http://http://gregmankiw.blogspot.com/2009/09/secret-is-out.html
Keep going Greg, YOU ROCK!!
Keep going Greg, YOU ROCK!!
World trade body ruling reflects pre-crisis time
The World Trade organization's ruling that European loans for Airbus wre illegal subsidies is being cheered by U.S. lawmakers loyal to the Boeing Co., even though the preliminary decision may seem quaint in a world where government subsidies, bailouts and takeovers are now commonplace.
Friday's ruling reflects the world as it existed five years ago when the United States brought the case against the European Union, arguing that such subsidies were unfair trading practices.
But since then, the deep global recession has led to hundreds of billions of dollars in government subsidies and intervention in nearly all the world's major economies, including big government ownership stakes in banks, and auto and insurance companies.
Furthermore, other countries, including China, Japan and Brazil, are busy expanding or developing their domestic airline industries.
At issue is a 1,000-page confidential ruling that was given to U.S. and European trade officials. It was not released yet, and officials were under instructions not to speak publicly. the ruling "confirms that Boeing has been competing on an uneven playing field for decades."
Friday's ruling reflects the world as it existed five years ago when the United States brought the case against the European Union, arguing that such subsidies were unfair trading practices.
But since then, the deep global recession has led to hundreds of billions of dollars in government subsidies and intervention in nearly all the world's major economies, including big government ownership stakes in banks, and auto and insurance companies.
Furthermore, other countries, including China, Japan and Brazil, are busy expanding or developing their domestic airline industries.
At issue is a 1,000-page confidential ruling that was given to U.S. and European trade officials. It was not released yet, and officials were under instructions not to speak publicly. the ruling "confirms that Boeing has been competing on an uneven playing field for decades."
Brown to G-20: Economy at 'critical juncture'
British PM, Gordon Brown has urged the world leaders to make a strong and clear commitment to increase effforts for boosting growth. He asserted today that the world economy is at a 'critical jucture'.
Addressing finance officials from the Group of 20 rich and developing countries at the start of their talks , Brown warned against ""complacency or overconfidence" in the face of mounting signs of at least a modest economic upturn.We meet at a critical juncture for co-operation in the global economy," Brown told officials from countries representing 80 percent of the world's output. "The G-20 needs to agree on a clear and unambiguous mandate for itself to give priority to the resumption of global growth and to help countries achieve sustainable growth going forward.
Japan, Germany, France and Australia all recording growth in the second quarter. Britain is widely expected to do so in the third quarter.
The International Monetary Fund has said that the global economy is beginning a sluggish recovery from its worst recession since World War II. The IMF last month increased its estimate for global economic growth in 2010 to 2.5 percent, from an April projection of 1.9 percent. But it also downgraded its forecast for this year to a contraction of 1.4 percent, from 1.3 percent.
The timing of a so-called exit strategy from the recent massive economic stimulus to drag the world economy out of recession is not yet agreed upon.
Germany has pushed for the G-20 to start talking about when and how they will withdraw stimulus measures, but others have warned that withdrawing the massive amounts of money injected into the ailing world economy any time soon could risk a double-dip recession. Pulling back the stimulus too late, however, risks corrosive inflation, some think.
Addressing finance officials from the Group of 20 rich and developing countries at the start of their talks , Brown warned against ""complacency or overconfidence" in the face of mounting signs of at least a modest economic upturn.We meet at a critical juncture for co-operation in the global economy," Brown told officials from countries representing 80 percent of the world's output. "The G-20 needs to agree on a clear and unambiguous mandate for itself to give priority to the resumption of global growth and to help countries achieve sustainable growth going forward.
Japan, Germany, France and Australia all recording growth in the second quarter. Britain is widely expected to do so in the third quarter.
The International Monetary Fund has said that the global economy is beginning a sluggish recovery from its worst recession since World War II. The IMF last month increased its estimate for global economic growth in 2010 to 2.5 percent, from an April projection of 1.9 percent. But it also downgraded its forecast for this year to a contraction of 1.4 percent, from 1.3 percent.
The timing of a so-called exit strategy from the recent massive economic stimulus to drag the world economy out of recession is not yet agreed upon.
Germany has pushed for the G-20 to start talking about when and how they will withdraw stimulus measures, but others have warned that withdrawing the massive amounts of money injected into the ailing world economy any time soon could risk a double-dip recession. Pulling back the stimulus too late, however, risks corrosive inflation, some think.
Tuesday, September 1, 2009
SAT Scores Fall as Gap Widens; Asians Gain
High-school students' performance last year on the SAT college-entrance exam fell slightly, and the score gap generally widened between lower-performing minority groups and white and Asian-American students, raising questions about the effectiveness of national education reform efforts.
Average scores for the class of 2009 in critical reading dropped to 501 from 502, in writing to 493 from 494 and held steady in math, at 515. The combined scores are the lowest this decade and reflect stalled performance over the past three years. The reading scores are the worst since 1994.
Average scores for the class of 2009 in critical reading dropped to 501 from 502, in writing to 493 from 494 and held steady in math, at 515. The combined scores are the lowest this decade and reflect stalled performance over the past three years. The reading scores are the worst since 1994.
The results come a week after the disclosure that only a quarter of 2009 high-school graduates who took the ACT, the other main college entrance exam, had the skills to succeed in college.
Gaston Caperton, president of the College Board, the New York-based nonprofit that oversees the SAT, stressed what he considered the good news in Tuesday's data: the growing and diverse number of students taking the exam.
A record 1.53 million students took the exam in 2009. About 40% were minority students, up from 29% in 1999. Education analysts said scores would be expected to drop as more students take the test, so College Board officials interpreted the stability in scores as encouraging.
Noting the gap in achievement between lower-performing minority students and the general population, College Board officials said those who lagged tended to go to school in poorer districts with fewer resources. "As a country, we must do better providing students of every background access to the best education," Mr. Caperton said.
College Board officials said that Asian-American students appeared to do better at all income levels. Officials said that was because they tend to take more Advanced Placement and other rigorous courses, and their families place a strong value on success in education.
Gaston Caperton, president of the College Board, the New York-based nonprofit that oversees the SAT, stressed what he considered the good news in Tuesday's data: the growing and diverse number of students taking the exam.
A record 1.53 million students took the exam in 2009. About 40% were minority students, up from 29% in 1999. Education analysts said scores would be expected to drop as more students take the test, so College Board officials interpreted the stability in scores as encouraging.
Noting the gap in achievement between lower-performing minority students and the general population, College Board officials said those who lagged tended to go to school in poorer districts with fewer resources. "As a country, we must do better providing students of every background access to the best education," Mr. Caperton said.
College Board officials said that Asian-American students appeared to do better at all income levels. Officials said that was because they tend to take more Advanced Placement and other rigorous courses, and their families place a strong value on success in education.
SAT Scores and Family Income
There has been quite a commotion going on over the blogosphere about the correlation between incoma and SAT scores. Much research has been done and opponents of the correlation have always found some snag in the research but to me, it does seem that such a correlation exists. Although, it might have some pretty serious repercussions and also mean some problems for the College Board, it seems logical that a correlation exists because a higher income means better SAT prep test and an affordability of reappearing in the test. I found these graphs in the New York Times blog which I would like to share which show a breakdown of SAT component scores and their realtion with income.http://http://economix.blogs.nytimes.com/2009/08/27/sat-scores-and-family-income/
KSE crosses the 8900 mark
It has happened at last,folks. While the world lampoons the signals that contradict the expectation of an economic recovery, the Karachi Stock Exchange Index (KSE) has crossed the level of 8,900 after more than eight months whereas yesterday, foreign investors made buying of $24, million, the highest during last 17 months.The trading started with increment of 76 points, however, KSE-100 Index soon cross the level of 8,900 with the increment of 200 points. Last time, such activity was witnessed in December 15, 2008 when KSE-100 Index reached at 8817 points level.Most of the buying of shares occurred in the sectors of oil and gas, banking, telecom, cement and transport.
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