German court upholds legitimacy of Eurozone bailouts. Stock futures are up.
A German court today (Wednesday) upheld the legitimacy of the Eurozone bailouts, according to the Financial Times. Fears that the court would rule otherwise have added to the volatile market situation this week, along with other debt challenges. The court did indicate that the government would have to submit the terms to their own governmental congress in the future. Stock futures are up based on this ruling. On Tuesday the Dow closed down 100 points at 11,139.
CEOs and Senior Executives become victims of recessionary reorganizations
Yahoo's CEO, Carol Bartz, was fired on Tuesday primarily due to the Yahoo board's belief that they continue to fall behind Google, according to the Associated Press. Yahoo shares jumped 74 cents after hours.
Bank of America also instituted a major executive shake up, firing Sallie Krawcheck, the head of its wealth management unit. According to the Financial Times, this firing was unexpected because Krawcheck's unit had been a bright spot in the overall financial picture of the bank. This precedes an historic reorganization to be announced by the CEO, Moynihan, in which it is anticipated that several thousand layoffs will be identified.
United States Post Office to lose $10 billion this year
Postmaster General, Patrick Donahoe, went before Congress on Tuesday indicating the Post Office would hit its $15 billion borrowing cap in September. The greatest expenses revolve around retiree health plans. Donahoe would like to limit the mail delivery to 5 days per week and close hundreds of offices, laying off over 120,000 postal workers. Donahoe cannot implement these measures without legislation being passed by Congress. According to Fox News, the House is ready to recommend 5 day delivery but many union supporters are hesitant to approve layoffs.
Rich Chinese seek emigration to the U.S.
In research conducted by the China Merchant Bank and Bain consulting firm it was determined that of the 20,000 Chinese with more than $15 million, 27% have already emigrated and 49% are considering leaving China. The Associated Press reports that the primary goal of rich Chinese is to use their wealth to leave their country and live elsewhere, with the number one choices being the U.S. and Canada. The Chinese choose to leave their country because of fear that the government will take away their assets, frustration over the land ownership rules and fear of other types of oppression. Their belief is that the healthcare systems and educational systems in other countries are superior and the pollution and poverty in their own country is also a negative factor.
Swiss seek to repel investment in their currency
The Swiss, in order to repel the capital pouring into their country because of its status as a safe haven, are capping the value of the Swiss franc, according to the Wall Street Journal. The Swiss vow to purchase as many euros as necessary to retain the status of any currency should it fall below 1.20 francs. It is believed that this action will have implications for multiple currencies.
Russia opens new pipeline
The Russians have opened a new pipeline that goes under the Baltic Sea, according to the Financial Times. The pipeline will bring gas to Germany, France, the UK, and the Netherlands. The pipeline cost $10 billion and is known as the Nord Stream pipeline. It was very controversial because it allows Russia to bypass the Ukraine, thus cutting transport fees formerly paid to that country.