Oil Prices silde below $100 a barrel

Oil prices tumbled to $97 a barrel which is the lowest in six month. Oil prices fell as dollar recovered and the possibility of a global economic slowdown indicated a low demand in the international markets. Prices had recovered initially on Thursday as Hurricane Ike headed toward energy facilities on the southern coast of the United States and OPEC announced a cut in output to check th falling prices.

The decline in the price of oil should be a good sign for countries who had been burdened beyond their capacity. Increase in oil price is the major cause of rising inflation. Now that the prices have already declined markedly, I think that the benefit of low prices will be passed on to the people.

Oil prices tumbled to $97 a barrel which is the lowest in six month. Oil prices fell as dollar recovered and the possibility of a global economic slowdown indicated a low demand in the international markets. Prices had recovered initially on Thursday as Hurricane Ike headed toward energy facilities on the southern coast of the United States and OPEC announced a cut in output to check th falling prices.

The decline in the price of oil should be a good sign for countries who had been burdened beyond their capacity. Increase in oil price is the major cause of rising inflation. Now that the prices have already declined markedly, I think that the benefit of low prices will be passed on to the people.

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Lehman Brothers faces financial difficulties

The fourth largest US investment bank, Lehman Brothers has reported a massive net loss in the third quarter. The troubled bank has outlined radical plans to bolster its financial position. The losses have reached $6.6bn after the bank made a loss of $3.9bn between June and August.

The bank has decided to slash its dividend and will sell a stake in its lucrative fund management arm. It has also decided to reduce its exposure to residential mortgages.

The shares of the bank which had plunged after information about its financial position have rebounded. It is expected that the steps taken by the bank will bolster the confidence of investors and reduce financial difficulties faced by the bank.

The fourth largest US investment bank, Lehman Brothers has reported a massive net loss in the third quarter. The troubled bank has outlined radical plans to bolster its financial position. The losses have reached $6.6bn after the bank made a loss of $3.9bn between June and August.

The bank has decided to slash its dividend and will sell a stake in its lucrative fund management arm. It has also decided to reduce its exposure to residential mortgages.

The shares of the bank which had plunged after information about its financial position have rebounded. It is expected that the steps taken by the bank will bolster the confidence of investors and reduce financial difficulties faced by the bank.

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Output issue and the OPEC meeting

The delegation of the United Arab Emirates has said that OPEC will continue to the keep the world well supplied with oil. There is a pressure on oil price in the international market. The price went below $105 a barrel from $ 147 a barrel in July. There have been demands from some countries such as Iran and Libya to reduce the output in order not to let the price fall below $100 a barrel.

The higher prices and rising unemployment rate have lead to a decrease in the demand in US which is the single largest user of petroleum products in the world.

The delegation of the United Arab Emirates has said that OPEC will continue to the keep the world well supplied with oil. There is a pressure on oil price in the international market. The price went below $105 a barrel from $ 147 a barrel in July. There have been demands from some countries such as Iran and Libya to reduce the output in order not to let the price fall below $100 a barrel.

The higher prices and rising unemployment rate have lead to a decrease in the demand in US which is the single largest user of petroleum products in the world.

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US takes over mortgage giants

Shares Markets in Asia and Europe gained after the announcement by the US government that it was taking over troubled mortgage giants Freddi Mac and Fannie Mae. US president George Bush said that the two mortgage lenders posed an unacceptable risk to the economy.

It is hoped that this largest bail-out in US history which could cost the Federal government $200bn would prop up the country’s housing market and end the credit crunch. Investors worldwide believed that a collapse could have a ripple effect on financial markets which could have resulted in major losses by major banks.
The plan announced by the Treasury secretary, placed the two companies into a “conservatorship” to be overseen by Federal Housing Finance Agency. The government would temporarily run Freddi Mac and Fannie Mae until they are on a stronger footing.

Japan and Australia have welcomed the move and said that this move would stabilize the financial markets.

Shares Markets in Asia and Europe gained after the announcement by the US government that it was taking over troubled mortgage giants Freddi Mac and Fannie Mae. US president George Bush said that the two mortgage lenders posed an unacceptable risk to the economy.

It is hoped that this largest bail-out in US history which could cost the Federal government $200bn would prop up the country’s housing market and end the credit crunch. Investors worldwide believed that a collapse could have a ripple effect on financial markets which could have resulted in major losses by major banks.
The plan announced by the Treasury secretary, placed the two companies into a “conservatorship” to be overseen by Federal Housing Finance Agency. The government would temporarily run Freddi Mac and Fannie Mae until they are on a stronger footing.

Japan and Australia have welcomed the move and said that this move would stabilize the financial markets.

Strike at Boeing to delay delivery of Dreamliner jets 787

Workers at Boeing went off their jobs on Saturday after talks failed to find a solution to avert a workers’ strike. About 25,000 members of the International Association of Machinists in the Seattle and another 2,250 in Oregon and Kansas went on strike after nearly two days of round the clock talks between Boeing and Union leaders.
Boeing spokesman said that they were disappointed by the situation. He said that they were hopeful that the workers would consider the offer and the money which they will get over a period of next three years.
The Union argues that the contract changes which have been demanded by the company would result in less job security. They also feared that more work will be outsourced to contractors and suppliers.  They said that the best pay and benefits offered were no good if there was no job security.
If this issue is not resolved soon, it would push back the delivery of the fuel-efficient 787 Dreamliner jets, which are in demand by the airline struggling with rising fuel prices.
Workers at Boeing went off their jobs on Saturday after talks failed to find a solution to avert a workers’ strike. About 25,000 members of the International Association of Machinists in the Seattle and another 2,250 in Oregon and Kansas went on strike after nearly two days of round the clock talks between Boeing and Union leaders.
Boeing spokesman said that they were disappointed by the situation. He said that they were hopeful that the workers would consider the offer and the money which they will get over a period of next three years.
The Union argues that the contract changes which have been demanded by the company would result in less job security. They also feared that more work will be outsourced to contractors and suppliers.  They said that the best pay and benefits offered were no good if there was no job security.
If this issue is not resolved soon, it would push back the delivery of the fuel-efficient 787 Dreamliner jets, which are in demand by the airline struggling with rising fuel prices.

US government to take over mortage companies.

Mortgage giants Freddie Mac and Fannie Mae which hold or guarantee more than half of the country’s mortgage debt will be put under government control in order to rescue them from huge financial losses. The two firms incurred heavy losses as a result of big increase in defaults and repossession in the US housing market. The takeover can be announced by the US Treasury soon.

The US Congress had approved a plan in July which aimed at providing more liquidity to the two companies. It could be the largest ever financial bail-out in the United States.

Mortgage giants Freddie Mac and Fannie Mae which hold or guarantee more than half of the country’s mortgage debt will be put under government control in order to rescue them from huge financial losses. The two firms incurred heavy losses as a result of big increase in defaults and repossession in the US housing market. The takeover can be announced by the US Treasury soon.

The US Congress had approved a plan in July which aimed at providing more liquidity to the two companies. It could be the largest ever financial bail-out in the United States.

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