Not one to shy away from moral decision making, US Governor Daniel Tarullo is known to be relentless, driven and determined in his pursuit of federal perfection
The bosses of the world’s biggest banks – US institutions in particular – must be tempted to erect straw effigies of Daniel Tarullo in the boardrooms and stick pins into him. One of six governors of the US Federal Reserve under chairman Ben Bernanke...
Syria’s civil war is costing the country dearly in more ways than one, and causing a disintegration of the tentative economic reforms previously in place
It’s not only people, buildings and, sooner rather than later, the al-Assad dictatorship, that are falling in Syria’s civil war. Its currency and economy are also in a headlong state of decline. And it’s Dr Adib Mayaleh, the economist governor of th...
Central bankers everywhere are under pressure, but none more so than Mario Draghi, new head of the European Central Bank
Long known as “super Mario” for his adroit stewardship of the Banca d’Italia – where he was in a more or less permanent battle with the profligate ex-PM Silvio Berlusconi – the 64-year-old’s main job is to save the euro from the collapse that ...
Mark Carney, Governor of the Bank of Canada, is about to start laying down the law as the newly appointed head of the Financial Stability Board
Mark J Carney has a CV that any central banker would die for. Having succeeded to the top job at the Bank of Canada in late October 2007 – that is, just before the financial crisis – he steered it through the turmoil without a single bank fail...
Christine Lagarde promises to bring a new social dimension to the IMF’s work
One thing Dominique Strauss-Kahn has done for the IMF is put it on the front pages. Until the French economist and politician became managing director nearly four years ago, turning it into a powerhouse of geo-finance before ending up on rape charges in N...
Credit threats are decades-overdue consequences of US fiscal myopia and insularity
Uncle Sam’s credit isn’t what it was. When Standard & Poor’s put a question mark over the medium-term future of the dollar by placing it on negative watch, it meant the greenback could lose its historic triple A status if the US econ...
The speed with which authorities discovered and froze kleptocrats’ assets tells us all we need to know about the true workings of geo-politics
Few would deny that freezing the assets of fallen or besieged dictators during the turmoil in Tunisia, Egypt and Libya was a good and important decision. The problem is that it happened so quickly that it is obvious the various governments knew all the ti...
Other nations talk, Switzerland acts
In some of the luxury-watch boutiques of Paris, you can hardly move for Asian – particularly Chinese and Indian – buyers. They’re cheerfully paying thousands of euros for handmade, horological masterpieces from Switzerland. In some store...
Corruption at the 2010 Commonwealth Games is being investigated
At roughly the same time as the head of the Delhi Commonwealth Games organising committee, Suresh Kalmadi, was patting himself on the back for conducting the event “really well,” prime minister Manmohan Singh was appointing a high-level commit...
Go back 90 years to the “roaring twenties” when brokers treated the investing public like fools. Throw in a few billion dollars of oil money and a mountain of debt. Sprinkle with the rich and powerful. Add a dash of greed. Serve with incompetent banking directors on an overheated plate.
Wall Street before the Crash of 1929? No, Nigeria. Or, at least, Nigeria before Lamido Sanusi became governor of its central bank last year.Outwardly, Nigeria is seen as a country with a well-capitalised banking system riding an oil boom. The second-large...
Each crisis requires its own solution, says the ECB president
Four days before the 110bn euro bail-out of Greece, president of the ECB Jean-Claude Trichet was airing his thoughts in Illinois about how best to deal with financial crises. He’s certainly seen a few in his time as a central banker par excellence. ...
Apart from being told the forensic accounting team has just uncovered a major fraud in the securities-trading floor, probably the last thing the boss of a French bank wants is an invitation to a meeting with finance minister Christine Lagarde. At the last...
Coercive forces grip India
"Urgently wanted: Scores of incorruptible financial experts with experience in infrastructure projects. Proof of bravery will be an advantage."That’s one advertisement we’ll never see in The Times of India. But it’s the kind of person th...
“Cleanliness is next to godliness,” insists Caleb Fundanga, Zambia’s reforming central banker
The head of the Bank of Zambia is a religious man. And he needs to be in a country that was until a few years ago infamous for corruption, the weakness of its central bank, the woeful inadequacies of its banking system, and generally low international reg...
In most western countries, the head of the central bank owes his appointment to the government but retains a fierce independence from it in matters of governance and policy
It’s not like that in China where Zhou Xiaochuan, governor of the People’s Bank of China, is on a mission, carefully co-ordinated with the government, to have the greenback replaced as the world’s reserve currency.As China (and Asia̵...
European countries are scrambling to raise every last penny of funds through taxes. But some countries may have gone too far...
Though all business taxes in Belgium can be paid online with little effort and preparation, the rates are still sky-high at 57.7 percent, including a staggering 50.8 percent total rate on profits only in social security contributions.
In Belarus, a company spends up to 338 hours annually preparing for and paying ten different taxes and duties. The total tax rate has incredibly been lowered to 60.7 percent, from 117.5 percent in 2008.
A company in France pays seven different taxes and duties, the sum of which can amount to 65.7 percent of profits; though President François Hollande has announced a wave of business tax rate cuts coming up.
A business in Estonia pays 67.3 percent of profits in tax, 37.2 percent exclusively in social security contributions. The country has gone against the grain in Europe by raising businesses taxes from 48.6 percent in 2008 to the current rates.
While corporate income tax (IRES) in Italy is limited to 38 percent of taxable profit, a company operating in Italy can expect to pay 14 other taxes and duties, including social security contributions, bringing their total payable tax to 68.7 percent of profits, according to the World Bank.
Norway taxes motor fuels twice, with a road use tax and a CO2 emissions tax. Combined with strikes in the energy sector that have curbed output, the price of gas at a local pump has soared to $10.12 per gallon.
Though Turkey sits on the Suez Canal and neighbours many oil rich countries, the price of a gallon of average gas clocks in at $9.41 in Turkish pumps, because of a 60 percent share of taxes.
Like Turkey, Israel is surrounded by oil-rich neighbours, but drills very little itself. Gas prices are controlled by the government, so about half of the $9.28 per gallon goes to taxes.
There are few gas stations in Hong Kong, but the ones available charge up to 76 percent more per gallon than mainland China, where the government caps the cost of fuel. A gallon at the pumps will cost around $8.61 on the island.
Expensive labour costs make the Dutch petrol prices the dearest in Europe, at $8.26 per gallon; though the 57 percent tax add-ons don’t help.
8 February 2007
HSBC warns of subprime mortgage losses
2 April 2007
New Century goes bus
14 September 2007
Wholesale markets have dried up
17 March 2008
Rescue of Bear Stearns
7 September 2008
Rescue of Fannie Mae
15 September 2008
Lehman Brothers file for bankruptcy
3 October 2008
US congress approves $700bn bailout
14 February 2009
$787bn stimulus approved by congress
The effects of the current financial crisis are global and irrefutable. With the collapse of Lehman Brothers, the domino effect of irresponsible public monetary policies, huge levels of unsustainable debt, and a deregulated financial sector, has escalated to the point where no corner of the globe has been left untouched.
Syria and Egypt launch an attack on Israel on Yom Kippur and set off a twenty day war;
US President Carter creates Department of Energy, which develops the US strategic petroleum reserve
The Organisation of Petroleum Exporting Countries (OPEC) used their oil reserves as a weapon with the Arab Oil Embargo against those who supported Israel. By January 1974, world oil prices were four times higher than they were at the start of the crisis, especially in the US, and the shock led to a huge drop in the stock market with NYSE losing $97bn in just six weeks. The embargo lasted five months, and the effects are still seen today.
1923 – 1924
The trouble began when Germany missed a repatriation payment, worth about one third of the German deficit in this period. Inflation was already high but by 1923 it was raging. Prices doubled within hours, and by late 1923, it cost 200bn marks to buy a single loaf of bread. People burned money as it was cheaper than buying firewood. Germany eventually regained control of its economy when it introduced the Rentenmark into circulation in 1923, and then the Reichmark in 1924.
The Great Crash
Recovery and Recession
After the decadence of the Roaring Twenties, the 1930s saw the biggest economic slump of all time. The stock market crashed on 29 October 1929, and optimism and decadent living tumbled along with the figures. The GDP fell from $103.6bn in 1929, to $66bn in 1934 and the subsequent years of recovery were the most dramatic in US history.
Otto Heinze and his brother Augustus Heinze bought shares of United Copper.
The stock market was already cautious over the tight money supply, but the US was thrown into a depression after the stock market fell nearly 50 percent from its peak in 1906. The Heinze brothers thought they could influence market shares but ended up bankrupting lenders that provided the financing to buy the stock. A chain reaction left nine institutions bankrupt. By February 1908, the panic was over and the government created the Federal Reserve system, to prevent banks from exercising too much control over the economy.