: US downturn forcasted, whatelse is new.
Roger.
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The end of privacy
All the marvels of the information age come with a hefty but probably unavoidable price: the loss of privacy
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Taking the weight
America cannot continue to drive the world economy alone. That was the message that emerged after the spring meeting of the Group of Seven rich countries. The official line was that the worst of the global financial crisis is over for the emerging economies. Beyond that, however, America is worried that its economy may cool even as Japan and EU countries remain unable to take up the slack.
<http://www.economist.com/l.cgi?f=/editorial/AC/1-5-99/index_fn6256.html>See article: IMF meetings, America v Europe
As if to confirm this, six German economics institutes cut their forecast for German growth in 1999 to 1.7%, down from the 2.3% estimate made last autumn. In Britain, there was relief that the economy managed growth in the first quarter of 0.1% over the previous quarter, but this is the lowest figure since 1992.
The beef trade war between Europe and America intensified. The EU said it may ban all American beef imports from June 15th unless they can be proved to be hormone-free. The EU looks increasingly unlikely to comply with a World Trade Organisation ruling against its existing ban on American hormone-treated beef, which is supposed to be lifted by May 13th.
The telecoms race
Americas AT&T is continuing to expand its cable reach. Barely had it completed its $55 billion purchase of the second-biggest cable firm, TCI, giving it cable coverage of a quarter of America, than the telecoms giant leapt in with a $58 billion bid for the fourth-biggest, MediaOne, which last month agreed a $48 billion merger with Comcast. Comcast hopes to find a white knight (perhaps Microsoft or America Online) concerned about so much cable being controlled by one company.
<http://www.economist.com/l.cgi?f=/editorial/AC/1-5-99/index_ld5396.html>See article: Beware the Internet gatekeeper
Bermuda-based Global Crossing is paying 550m ($890m) for the undersea cable-laying operations of Britains Cable & Wireless, as it continues to build fibre-optic networks round the world. The business is one of Cs oldest, going back 150 years, but the company is shedding units to concentrate on business-communications services.
Another British company turning rapidly to telecoms is GEC, which two months after buying one American maker of telecoms equipment (Reltec, for $2.1 billion) announced that it was buying another, Fore Systems, for $4.5 billion. In January, GEC said it was selling its defence business to British Aerospace for 7.7 billion ($12.8 billion).
<http://www.economist.com/l.cgi?f=/editorial/AC/1-5-99/index_wb1944.html>See article: Britains GEC communicates
Consolidated net profits at Sony fell by a miserable 19% in the year to end-March, to 179 billion ($1.4 billion), hurt by economic woes in Asia and Latin America, and price wars in the United States. On top of that, Sony said that this years profits are likely to slide to 110 billion as sales of its games console, PlayStation, begin to sag after four years of heady growth.
Disney issued a profits warning for the full year after reporting that net profits had fallen by 41% in the second quarter to $226m; revenues rose by 5% to $5.51 billion. Theme parks, as usual, continued to do well, but video and retail sales were weak.
Eurosurf
Britains Kingfisher and Groupe Arnault of France are to launch Libertysurf, a free Internet service that will be available first in France and eventually throughout the whole of Europe. The two retailers hope that by jumping in early, they will gain the sort of lead that Dixons, an electrical-goods retailer, did in Britain last September. It launched a free service that rapidly gained 1.3m users and brought a host of other free services into the market.
<http://www.economist.com/l.cgi?f=/editorial/AC/1-5-99/index_wb5461.html>See article: Free Internet services in Europe
Two British health and fitness groups broke off merger talks. A deal between First Leisure and Cannons fell through over finances. First Leisure may now be vulnerable to a bid.
Keith Henry resigned after four years as head of National Power, leading to speculation that Britains biggest electricity generator may be vulnerable to a break-up or a takeover.
Karel Van Miert, the EUs competition commissioner, gave the go-ahead to a French defence merger between Lagardres Matra and Aerospatiale. But he warned two other giants that they could not get round competition rules. Cadbury Schweppes has agreed to sell its soft-drinks brands outside the United States to Coca-Cola for $1.85 billion, but the two have asked individual European countries, plus many others round the world, to clear the deal, when they should have asked the EU.
Mr Van Miert also raised questions about British government aid to BMW to help keep a Rover car factory at Longbridge in Britain. Did BMW seriously consider moving the factory to Hungary, he asked
Bausch & Lomb, an American optical group, has agreed to sell its sunglasses business, including Ray-Ban, to Italys Luxottica Group, for $640m.
Take the cash
Bradford & Bingley, Britains second-largest building society, lost its battle to remain as a mutually owned society when its members voted to convert it to public ownership, a move that will bring each of them a cash windfall. It was the first time that members of a building society have over-ridden a boards wishes on mutual status.
<http://www.economist.com/l.cgi?f=/editorial/AC/1-5-99/index_fn4927.html>See article: Can mutuality survive?
Two deals that seemed to signify a grand restructuring of Italian banking seem to be unravelling. The Bank of Italy blocked a bid by the countrys largest banking group, Sanpaolo IMI, for a reluctant Banca di Roma. Mediobanca, a powerful merchant bank that wants to remain that way, objected to the bid and also to one proposed by UniCredito Italiano for Banca Commerciale Italiana.
<http://www.economist.com/l.cgi?f=/editorial/AC/1-5-99/index_fn3234.html>See article: Bankings regulatory impasse
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