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Goldman Sachs accused of deceiving customers

From our Washington correspondent

Goldman Sachs has managed to earn 3.7 billion dollars in betting, starting in 2007, the collapse of the mortgage-market. In doing so, the giant Wall Street acted against the interest of some of its customers, which it sold securities that he knew "toxic". This is the conclusion, after months of investigation, the Permanent Subcommittee on Investigations of the U.S. Senate.

Tuesday, during public hearings stretched on Capitol Hill, Lloyd Blankfein, the head of the giant Wall Street, has categorically denied these allegations."We do not speculate massively downward in the housing market and we certainly do not bet against our clients," he was forbidden under the spotlight, saying that even on the mortgage-market, Goldman Sachs has lost about $ 1.2 billion in 2007-2008.

"Nobody in the management of Goldman Sachs has never asked me to bet on a decline in the subprime market," added before skeptical senators, Joshua Birnbaum, the former head of structured products of the bank, also on the bench defendants.

Convinced otherwise, armed with emails and internal documents seized in the bank, the debonair Senator Carl Levin, glasses pavement at the end of his nose, led a determined assault Tuesday. But the chairman of the committee was confronted with a wall.He vainly tried to tell the past and present officials of Goldman Sachs called before him (including one French employee), how could they believe in the quality of debt issued by mortgage lenders whose reputation was terrible. Receivables classified as "business of shit" in an email exchange between two bank officials. "How many of these" affairs of shit "did you sell to your customers? asked, exasperated, Senator Levin. You've sold hundreds of millions. "

Bankers Daniel Sparks and Michael Swenson, impassive without being arrogant, but obviously confident of the merits of their point of view, seemed not to understand or what they asked or what they were charged.They also questioned the methods of calculating profits of Goldman Sachs selected by the committee.

Battle of Senate proceedings

According to Senator Levin, the investment bank has yet actually decided in late 2006 to a major cleanup of its accumulated risk on securities backed by the real estate markets whose collapse loomed. By discipline, to limit its risks and if possible in the hope of profiting from the trend, the bank had sold to investors and deliberately chosen for their credulity his titles too "toxic"."We have not been systematically and significantly" net short position "on derivatives of residential mortgages in 2007 and 2008," replied Lloyd Blankfein.

Meanwhile in the Senate floor, Democratic leaders and Republicans arguing over procedural votes before engaging in substantive debate on the reform of Wall Street. The Conservatives want by all means restrict the scope of Democrat Bill before it is submitted to a plenary debate in the room. A compromise is always likely, because both parties want to correct the excesses that precipitated the financial crisis.But the Republican minority wants to take his time, while Democrats want to take this case Goldman Sachs to prohibit such banks with access to the discount window the Fed to speculate on their own account.

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New charges against Goldman Sachs

The clouds are gathering over Goldman Sachs. After the announcement of a complaint by shareholders against the directors, the Wall Street Journal revealed on Saturday that five of them sold their shares after the bank had been informed that an investigation by the SEC, the U.S. stock Constable , was the establishment. They have sold their shares at a purchase price of $ 65.4 million (48.9 million euros).

The Wall Street Journal, officials have sold the shares in question are an attorney, two vice-presidents, a chief accountant and a member of the board of directors.

The sales took place between October 2009 and February 2010, the Wall Street Journal reported on its website, citing the company InsiderScore.com, which presents itself as an observatory of insider stock transactions.A few months ago, in July 2009, the SEC had informed the bank that it was considering legal action against them.

On April 16, the day the SEC announced it had filed a complaint for fraud against Goldman Sachs in the civil courts, as the Goldman Sachs lost 13% of its value on the NYSE. The fall had continued throughout the week.

To prove his good faith

The announcement comes as Goldman Sachs is preparing his hearing Tuesday before the Parliament. According to a document of 11 pages that she purchased the Washington Post, executives at Goldman Sachs who will testify alongside Fabrice Tourre want to demonstrate their good faith in this matter.

Before the Senate subcommittee investigation on the financial crisis, they will indicate that they do not know if housing prices would increase or decrease when the product under investigation, the Abacus, was sold. The document describes the debate that animated the leaders of investment banking in 2006 and 2007. As proof, the bank will provide the e-mails on the subject by the leaders.

Nuisance emails

Their testimony should however be undermined by embarrassing e-mails released by a Senate committee on Saturday. According to the messages exchanged, the bank would have otherwise benefited from the mortgage risk to pocket tens of millions of dollars.

In one of these messages, the CEO of Goldman Sachs, Lloyd Blankfein, wrote: "We obviously have not escaped the bedlam of subprime mortgage.We lost money and then we have won more than we lost through our short position. In another mail, managers assess the consequences of failing grades assigned by rating agencies, subprime, "like we're going to make much money," wrote one of them. "Yes, we are well positioned," replies his colleague.

"Investment banks like Goldman Sachs did not just brokers, they were interested developers of risky and complex financial products that led to the outbreak of the crisis," says Carl Levin, chairman of the Sub-Commission Senate Permanent Investigation, which will face the leaders of the bank Tuesday.

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IMF: the euro area lags behind the global recovery

The weather global economic summarized in three figures: production (GDP) will grow 10% this year in China, 3.1% in the U.S. and 1% in the euro area countries. For the whole world, growth is expected in 2010 to 4.2% and 4.3% in 2011. With a clear dividing line between the advanced countries, whose growth prospects are around 2.3%, while savings "emerging or developing" a galloping pace of 6.3%.

These new "World Economic Outlook," IMF showed that "the recovery unfolds better than expected. But new challenges have emerged and exceptional "cautioned Olivier Blanchard, chief economist of the Fund. He calls a "warm" restart in the advanced countries, which are still found a lower level of production of 7% it would have without the crisis.In the eurozone, the IMF also revised downwards by 0.1 percentage point to 1% its forecast for growth in 2010, although France, among others, has fared rather better with a forecast of 1.5% instead of 1.4%.

Dependence credit

For Europeans to wonder why their economies pull themselves together much more slowly than America, Olivier Blanchard gives two main explanations. Europe is "more dependent on bank credit as the U.S. market where finance plays a greater role for business and they have restarted the fittest." Furthermore "the policy responses have been later and less strong in Europe," he adds.

This means that the IMF does not disavow the fiscal stimulus plans, including Dominique Strauss-Kahn, their boss, was one of the strongest supporters, from January 2008.But "it is urgent to develop strategies for fiscal consolidation in the medium term" now stress the same experts. They note that the budget deficits in advanced countries have now reached 9% of GDP on average and that "the debt / GDP ratio should exceed 100% by 2014 if nothing is done.

Rebalancing Economic Policy

The situation is more delicate than a too abrupt adjustment of public finances could hinder growth already shaky. Hence the advice to double trigger "to fully implement fiscal stimulus measures planned for 2010, except in countries which already have a strong increase in their risk premium and must begin to rebalance their budgets now," as Greece. But the most advanced countries should undertake a substantial fiscal consolidation in 2011.

Emerging economies are the reverse face "to an influx of capital, a good thing in itself, but can become excessive," warns Olivier Blanchard. He recovered one of his favorite anthems "the currencies of a number of emerging markets remain undervalued in considerable proportions regarding the yuan." It calls for a revaluation of the currency, both in relation to the dollar than the euro, the only way to give oxygen to Western exports and ease the risk of overheating in Asia. This rebalancing of economic policies will be central to discussions of the G20, whose finance ministers meet Friday in Washington.

Shy increase the Tokyo Stock Exchange

After a fence in red on Tuesday, the Asian stock markets end in almost all the green on Wednesday. The Nikkei 225 rose 0.21% to 11,184 points, ahead of Taiwan Index from 0.43% to 8064 points, the Seoul Stock Exchange finished up 0.97% to 3639 points and climbs Sydney 0.67 to 4985 points. In contrast, Hong Kong was down 0.07% to 22,088 points.

On the macroeconomic front, the Singapore authorities said Wednesday that the country's economic growth could be between 7% and 9% this year, against previous forecasts of 4.5% to 6.5%. It could even reach the first quarter of this year 13.1% and 32.1% a year over the fourth quarter of 2009.Consequence: Stock Exchange of Singapore, the Straits Times Index closed up 1.05%.

Barrels of oil increase

Following a meeting between Chinese President Hu Jintao and his U.S. counterpart, Barack Obama, under the Nuclear Summit in Washington, Bush reiterated his desire to see China revalue the yuan no teletrack payday loans.

Crude prices are trending upward in Asia Wednesday, the market reacts to forecasts of rising demand for crude announced by the International Energy Agency (IEA).In morning trading, a barrel of light sweet crude for May delivery took 34 cents to 84.39 dollars, while Brent North Sea with identical maturity, gained 18 cents to 84.90 dollars.

In its monthly report, the IEA has reviewed again slightly upward, from 30,000 barrels per day its forecast for global oil demand in 2010. Consumption is expected to rise this year to 86.6 million barrels per day on average, 2% more than last year.

Toyota has advised its Canadian and American dealers to suspend sales of its Lexus model, the GX 460, following criticism from a consumer magazine, Consumer Reports. At the Tokyo Stock Exchange, the title won 0.13% to 3710 yuan.

The Dow Jones closed at 11,000 points beyond

Wall Street started the week in near balance, then moved into the green early interactions. An increase, however fragile, while the budget deficit emerged in sharp decline in March, to 65.4 billion. A decrease of 65% yoy. Analysts were expecting a lower deficit.

At the close, the Dow Jones climbed 0.09%, the Nasdaq is 0.16% and the S & P 500 of 0.18%.

This slight increase still leaves the Dow Jones crossed the symbolic threshold of 11,000 points. The index reached 22 hours, 11,006 points. A first since September 2008. And the S & P reach almost 1200 points to 1197 points exactly.

The U.S. stock markets have recently experienced six consecutive weeks of increases, an unprecedented series from the lowest 12 years and a half touchdowns in March 2009.On the foreign exchange market, the euro is rising against the dollar after the announcement yesterday by the countries of the eurozone plan the details of aid to Greece.

Oil prices fell for the fourth consecutive session, still affected by an abundant supply and low demand in the United States.On the New York Mercantile Exchange (Nymex), a barrel of light sweet crude for May delivery finished at 84.34 dollars, down 58 cents from the previous day.

Indicators to follow this week

On the macroeconomic front, the week will be marked by several important indicators such as the index of consumer prices, retail sales for the month of March, industrial production, housing starts and the first estimate of the index Reuters confidence-Michigan.

The markets will also follow the hearing of Ben Bernanke, chairman of the Federal Reserve, the Congressional Joint Economic Committee on Wednesday and will monitor closely developments in the case of the Greek debt.

Alcoa opens the ball Publications

Palm jumped 17.05%.The group was mandated to advise the banks to sell its business or other opportunities, according to news agencies.

On the side of values, the oil industry runs the meeting. Friday Chevron (1.22%, to 80.43 dollars), without giving a figure, has announced an increase its refining margins in the first quarter. The group takes advantage of the rising oil prices and a possible improvement in its refining margins.The major U.S. must publish its accounts on April 30.

According to the press, the merger between United Airlines and U.S. Airways (2.73%, to 7.52 dollars) should be performed exclusively by exchange of shares.

The Department of Treasury of the United States announced plans to sell at auction in six weeks, before the end of May, the warrants of Wells Fargo shares were granted during the salvage of the bank in the fall 2008.

Microsoft has unveiled a new phone especially for the youth market of social networking fans, called KIN, developed with Verizon Wireless and Vodafone and manufacturer Sharp.

ConocoPhillips has announced the sale of its Chinese Sinopec stake in Canadian oil sands project Syncrude for $ 4.65 billion dollars.

Just after the close, investors have taken note of the first quarterly results of major public companies. As usual, the aluminum giant Alcoa, which gave the start of the season publications. Analysts expected a return to profit, its first since a year.

Meanwhile, Alcoa shares have been 1.39%, to 14.59 dollars.

The coming week will also be driven by quarterly results from Intel, Google, General Electric and JPMorgan Chase & Co. banks among others.

"Caution should be clear," says Aurel, who says that "the discourse of business remain positive on the merits but there are risks of disappointment on margins or unit on a possible downturn in order books in the coming months." The industry, raw materials, financials and semiconductors are the sectors most at risk.However, the agri-food sector, distribution or energy values could pleasantly surprise.

Lagarde returns to Berlin at the cost of a tax on banks

In Berlin

That's all smiles as Wolfgang Sch?uble, German Minister of Finance and his counterpart, Christine Lagarde, have been presented to the press after the German Council of Ministers which, for the first time a foreign minister was able to attend. After quarrels on the question of rescue of Greece and the tensions in the German economic model, the French Minister has stressed "the very friendly and warm hospitality" of his German colleagues. Asked about his remarks about the controversial German exports, Christine Lagarde has countered that she had wanted to "congratulate" the German competitiveness. "I am very careful not to criticize, because we must first put its own house," she smiled.

The Franco-German reconciliation was played around a tax on banks that Berlin wants to impose on the European and international level, with the support of Paris.The compulsory levy, calculated in terms of systemic risk – that is to say the risk of contagion that would expose their failure to the rest of the economy – should contribute to a fund to help financial institutions.

More than one billion euros

In Germany, such a tax would yield 1 to 1.2 billion euros per year. "A bill must be presented before the summer holidays, and may be adopted in the second half of the year," said Wolfgang Sch?uble No faxing pay day loans. For the Minister of Finance taxation of banks should remain "moderate" to avoid compromising their role in providing credit to the economy that is recovering from recession.

To avoid distortion of competition, Paris and Berlin argue like the International Monetary Fund (IMF) for a tax credit internationally.Christine Lagarde believes it is important to act "on a double angle: Prevention and Accountability" of financial institutions. But the tax credit mechanism must also "maintain a set level playing field between banks involved in international markets.

One issue still under discussion between the two countries: the destination of the tax. While Paris wants to assign to the state budget, the Germans are considering creating a special fund.The national rules will be required, although the mechanism is doomed to fall within a framework of European regulations or international.

"The Franco-German cooperation is narrow, it becomes more and more, and is based on trust," said the German finance minister, who will attend an upcoming French Cabinet, a priori, April 7.

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The Portugal is not Greece, but …

After Greece, Portugal? The degradation of the note by the rating agency Fitch on Wednesday placed the country under the Lusophone market attention. But nothing is to fear the worst: Portugal is not Greece, although the weakness of its economy worries for the future.

"Comparing Greece and Portugal is really too simplistic," wrote economists at the outset of IPC BNP Paribas in a note. Take note first of the country. Greece, with a "BBB +" is two categories below Portugal, rewarded for his share of "AA-". The degradation of the note Portuguese did not, moreover, resulted in a panic on the markets.Shortly after the announcement of Fitch, the cost of insurance on the Portuguese debt increased by only 5 points early Wednesday afternoon, with 139 points, according to Markit data.

If Portugal has a higher score, mostly because its debt is less severe than that of Greece. It should reach 90% of GDP in 2010, when the Athens peak at 123.3% of GDP, according to the OECD.

Reform and credibility

The best that Portugal has maintained its accounts in large part to the reforms already carried out social security and pensions. Result, expenditures related to aging, reaching 16% of Greek GDP between 2010 and 2060, will be limited in the case of Portugal to 2.9%, calculated the European Commission. "The impact of these reforms will be felt in the future, limiting the burden of an aging population," noted economists at BNP Paribas CIB.

Having made these reforms in Lisbon has guaranteed a much greater credibility than that of Greece. Apart from a National Statistics trusted, the country should not face great opposition to social reforms, as demonstrated by the fiscal consolidation undertaken between 2003 and 2007 are essentially the economists.

Concerns for growth

The Portuguese public finances so little to do with those of Greece. But the economic prospects are not rosy, however. "Our concern is growth," says a note Gilles Moec, economists at Deutsche Bank. "We believe that the likelihood of a return to budget deficits of 3% by 2013 (against 9.3% in 2009, Ed) is low."

The country's lack of competitiveness, exports depend mainly on its neighbor Spain, very bad shape.Especially, the level of indebtedness of households and businesses has reached alarming levels, thus jeopardizing any hope of quick recovery in domestic demand and investment. According to Eurostat, household debt represented in 2008, 105% of GDP, and the business 134%. Cons respectively 61% and 62% in Greece.

Unions in the street

The mobilization will she go in this Tuesday, two days in a large loss of the right in regional elections? Six unions (CFDT, CGT, FOR, FSU, UNSA, Solidaires) called on employees of public and private to a national day of action aimed at influencing government policy on political and social. If it comes shortly after the regional elections, the appointment union had however taken immediately after the Social Summit in February, meeting at the initiative of the Head of State to discuss, among other things, the upcoming construction of the reform pensions.

Tuesday afternoon, thousands of demonstrators began to march throughout France. If the number of participants were not recorded in Paris, 10,000 people marched in Nantes by the CGT, the police still had no figures available. They were at Le Mans 7000, according to police, 2000 in Vannes, according to unions.In Rennes, the mobilization seemed weaker. Also according to police, Lyon accounted as 10,000 demonstrators, Grenoble 5000, and Saint-Etienne 4400.

The strike of civil servants was also relatively followed in mid-day. The department estimated that 21% the proportion of striking teachers, estimated at 40% for the SNES-FSU, a rate higher than the previous mobilizations. 11.45% of the postal employees were also mobilized by the leadership. At the station, the strike rate was estimated at 28% by management, and 32% by the CGT. At RATP, it would amount to 14% depending on the direction, the CGT-RATP not yet have figures to communicate.

Pension reform crystallized discontent

Two main points today crystallize opposition from unions, following a government reshuffle.

• Pensions: major point of contention between the unions and the government, the pension reform was launched at the Social Summit in February. While the dialogue should begin early April, several union leaders have spoken about this on Tuesday, sending a warning to the government. The CFDT leader Francois Ch?r?que has called for a reform that reduces inequality. "Of course we must change our pension system, but it does not evolve towards greater social justice, this is again a loss of confidence in politics" best payday advance !!!???!!!?? ?!!!. Therefore, it could "be the sport at a social level," he warns.Jean-Claude Mailly, secretary general of FP, for his part reiterated on Tuesday his commitment to the LCI retirement at age 60, holding "absurd" the solution of longer working hours to alleviate the funding problems induced by the lengthening of life expectancy. "If we follow this logic, women live longer should work longer," he argued. As for Bernard Thibault, leader of the CGT, he believes "we can not impose reform on accounting criteria exclusively, also challenging the objectivity of the Advisory Committee of pensions. "This appointment will be very difficult to carry," he predicted. Probably heard a speech by the new Labor Minister, Eric Woerth, who insisted on Tuesday on the need to "protect" the current system "an equitable reform.

• Employment: while the unemployment rate back above the 10% in the fourth quarter of 2009, the CFDT called for taking further steps to assist employees affected by the crisis. Pleading for an appeal to partial unemployment, training rather than dismissal, the leader of the CFDT has also called for financial support purchasing power and resources center for sustainable employment. The employees "have the feeling that we no longer speak of their real situation since September. An impression they would have in his Sunday expressed through the ballot box. The government must now "give strong signals, and change of method," he said. A view shared by the leader of the CGT, Bernard Thibault, who on Tuesday urged the convening of a new social summit at the Elysee.The meeting, a time desired by the head of state says he would aim to "take stock of the situation regarding employment, economic and social policy and purchasing power for practical decisions for implementing fast.

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France Telecom "may appease the social climate"

After two days of contacts with the new CEO of France Telecom, Stephane Richard, and Chief Financial Officer Gervais Pellissier, the Oddo Securities analysts draw conclusions rather reassuring: the new management team "has the qualities needed to improve the social climate within the group, without deteriorating financial goals.

Stephane Richard, who replaced Didier Lombard on 1 March, has confirmed giving priority to the alleviation of social relations within the group.Oddo Securities said in a note published today have felt the new management as "very attentive, controlling well the great social, financial, and fellows of the group and sector, and wishing to show more transparency and sense that commercial shine.

Social criteria are taken into account for the premiums

Among the concrete steps, variable pay (bonuses) for a little over a thousand leaders in France will now be indexed to 50% on financial criteria (against 80% previously), to 20% on quality criteria Services (unchanged), and 30% on social criteria (non-existent before), if possible, quantifiable as absenteeism.

Furthermore, agreement with unions was recently signed to the senior part-time and mobility.And an action plan is provided, internally, to "motivate all the teams around unifying themes, they add, such as quality of service, accountability teams decentralizing some decision-making, improved working conditions, etc..

Management believes these new devices n'impacteront hardly the finances of France Telecom, which has already made "significant restructuring since 2002," says Oddo, who adds that the cost of social concessions is already integrated in the accounting 8 billion euros of cash flow in 2010.

The operational track

Besides the social side, management has raised a dynamic business "still very strong in the mobile in France and Great Britain. The target of 35% ADSL market share in 2010 is maintained.

Investments should be under control, "the group had no problem of saturation of its mobile networks. France Telecom does not accelerate but rather the deployment of 4G from mid-2011 if necessary, "says Oddo.

Considering all this information, the team of analysts expressed confidence in the ability of France Telecom to maintain its dividends "beyond 2011".

Acquisition strategy shy

No big acquisitions in sight. While St?phane Richard wants to promote growth in the long-term actions to respond to the stock market rising, it remains on the defensive. A shift could occur if a major consolidation movement was born.

France Telecom remains focused on some inexpensive targets outside Europe or purchases "in market" in the Old Continent.Oddo suspected a connection between Telenet and Mobistar, or rallying with a fixed player in Spain. In Britain, the broker anticipates that the joint venture Orange / T-Mobile UK will seek a buyer for its fixed network. Ultimately, it is also possible that the joint venture includes a British MNVO (MVNOs) like Virgin Mobile.

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Wall Street is marking time

As expected, the increase in U.S. indices is very shy. Investors are always in effect evidence of caution before the publication of several major macroeconomic indicators. In early trading, the Dow Jones and Nasdaq 100 advanced 0.04% to 10,572 points and 0.01% at 2340 points. Tuesday after a turbulent session, the U.S. stock markets finished slightly higher, the Nasdaq has shackled its tenth session in the green.

The next U.S. statistics are expected Wednesday, with the traditional weekly report on unemployment, wholesale inventories in January and after closing the federal budget in February.Weekly Market in the United States, will then be placed under the sign consumer with the publication tomorrow of the sales details for the month of February and the preliminary estimate of consumer confidence.

Oil finished down slightly on Tuesday on the New York market, falling from a high of eight weeks, the April contract closed down 0.5%, to 81.49 dollars, penalized by a stronger currency U.S..

AIG rise another 12%

On the side of values, the insurance giant AIG, which forced march to advance its restructuring was awarded 13% Saturday and climbed again this Wednesday, from 12.57% to 36.89 dollars. Traders welcomed the efforts made by the insurance company to reimburse the state aid, a shareholder at 80%. The group conducted a series of steep cuts to enable it to garner around 25 billion dollars.

Citigroup allows itself for its 4.19% to 3.98 dollars after yesterday awarded more than 7.5%. The state could sell shares in the bank.

United Airlines has announced a growth of 18% of its turnover in passenger transport on February. The president said the group observed clear signs of renewed activity. Note, however, the snowstorms have affected the company announced a loss of 40 million due to the cancellation of hundreds of flights. The securities are 3.69% on Wednesday to 18.83 dollars.

Facet Biotech Corp. has accepted the takeover offer made by Abbott Laboratories, priced at $ 27 per title, a cash offer totaling $ 450 million. Direct impact on the stock market: Facet Biotech Corp. explodes from 66.19% to 26.94 dollars.Abbott remains in equilibrium.

Cisco on Tuesday claimed a major milestone in the conquest of Internet connections at very high rates, presenting a new router overkill.