Business News and Economic News

The European Stability becomes operational

The European financial stability, to assist Member States in the euro area experiencing solvency problems, became fully operational Wednesday after weeks of uncertainty about the ratification of its Statute.

European fund, which can now raise up to 440 billion euros with the security of countries in the euro area, is part of an overall mechanism developed in the emergency early May, during the debt crisis of the European and capable of raising up to 750 billion euros with the involvement of the IMF.

The mechanism became fully operational on August 4 when Italy has confirmed its commitment to provide its guarantee for any loans issued by the Special Purpose Vehicle (SPV or "mutual fund assets"), said the representatives of the European Stability financial (FESF).

'I am pleased that Member States of the euro area have reached the final stage in the development of FESF, said in a statement Klaus Regling, Director General of the fund.

"The FESF is now fully operational and can if necessary, issue bonds with the assistance of the Office of the German debt, which would be guaranteed by member states of the eurozone."

No financial score has yet been assigned to the SPV, based in Luxembourg.This step constitutes an essential element for the cost it would have to agree to issue debt, if ever he has to do.

The funds should in theory receive the maximum "AAA" by the major rating agencies, the same rating as that assigned to debt securities issued occasionally by the European Commission with support from EU Member States.

END OF THE PROCESS OF RATIFICATION

The mechanism of financial stabilization, which had been agreed by Heads of State and Government of the eurozone at a special summit in Brussels on May 9, would then be transposed National in each participating state.

Its application has been suspended, however long the ratification of Slovakia, who was crossing a tense election period in which the issue of financial support to Greece's participation in the stabilization fund arose as European.

The new Slovak Minister of Finance appointed in early July has finally ratified the European Agreement on July 16.The surprise of the notification without approval of Italy August 4 marks the end of the process of ratification of 16 member states of the euro area.

After the recovery of financial markets, halting the fall of the euro and the favorable report of the EU and the International Monetary Fund on Greece, it is possible that the Fund, whose life is in principle limited 3 years, will ultimately not used.

The Dow Jones ended virtually unchanged, the Nasdaq gained 0.13%

The NYSE has ended in a disorganized meeting Friday after a nondirectional, two indicators found reassuring on industrial activity and consumer confidence offset the announcement of a slowdown in growth in the second quarter.

The Dow Jones closed down on a symbolic point of 1.22, or 0.01%, to 10,465.94.

The S & P 500 is broader, was also virtually unchanged at 1101.60 points (0.01%).

The Nasdaq Composite Index was on his side of 3.01 points (+0.13%) to 2254.70.

For the week, the Dow Jones rose 0.40%, the S & P 500 lost 0.1% and the Nasdaq dropped 0.65%.

Mattel earnings below expectations because of the euro

Mattel announced Friday a lower than expected earnings in the second quarter, a weak euro offset the benefits of licensed Toy Story 3 and strong sales of Hot Wheels.

The manufacturer of the Barbie doll has reported a profit of $ 51.6 million, or 14 cents per share, against 21.5 million (six cents) a year earlier.

Turnover increased 13.4% to $ 1.02 billion but the effects of unfavorable exchange slashed three points to this growth.

The Thomson Reuters consensus I / B / E / S gave an EPS of 15 cents and revenue of $ 1.02 billion.

Sales in the U.S. increased by 17% and 9% in the rest of the world.

Sales of Barbie and Hot Wheels were up 6% and 11% respectively, while those of American Girl fell 4%.

Pension reform will contribute to reducing the deficit by Bercy

The pension reform presented Wednesday, June 16 by the Labour Minister, Eric Woerth, will help reduce the government deficit in France to 0.5 by 2013, when the government pledged to reduce it to 3 % of gross domestic product (GDP), according to estimates provided by Bercy.

"This reform helps to improve the deficit by about 0.5 percentage points of GDP by 2013, it was argued in the entourage of the Minister of Economy Christine Lagarde. By 2020, the measures announced by the government "would reduce the government deficit by 1.9 percentage point of GDP, they added the same source.

The government deficit (state, corporate and local) of France, formed by the crisis, should beat a new record this year, 8% of GDP.The Government is committed to the European Commission to take on the 2013-3% limit allowed by the European Stability Pact.

Brussels said Tuesday that France would "specify" the budget saving measures planned to take its objective and could be forced to take further.